Hello guys I am in process of lending to a home owner that needs cash to redeem his tax lien from an Investor that purchased his delinquent property taxes last year. I am having a title company to do a title search to make sure that the only lien is that of the investor that owns the tax certificate . the agreement is that once i fund the home owner , that i will be the only and first lien holder. His attorney will write up a promissory note stating the loan terms of the loan. (3year amortize short loan. )
Can you guys think of any other due diligence am missing.
thank you in advance for your input. by the way the property is free and clear and has plenty of safety in the price of the property vs my loan.
You mentioned a promisorry note but you did not mention a mortgage (or deed of trust) to secure the note. The note and mortgage are two diferent documentts and you should have both.
I would not have his attorney write up anything. His attorney has a duty to look out for his clients interests not your interests. Since this is a comsumer loan, I presume this is for his own home, there are lots of laws regardiing making this loan. It may not be enforceable if you do not follow all the apropriate laws and rgulations.
How is he going to pay you back if he couldn't pay the taxes in the first place? Who is going to be responsible for the new taxes?