Paying "0" dollars for a property?

Question

I'm not sure how to approach this one. A friend decided to sell me his property. We agreed on a sale price of 100k.

I had offered at one point to pay him 5% if he wanted to play a silent investor on one of renovations. He said he didn't need the money immediately, and would just essentially "loan me" the 100k and let it start accruing interest for the next year or two. He said he didn't want payments, just to pay him back at the end of the agreed upon term.

So, my question. Is there a way to go through a closing attorney and change the deed over, but to not have the money actually exchanged?

I guess this wouldn't be far off from owner financing...

Tim Herman · Answer

@Sean H. This is owner financing with no dp and no payments. A title company or attorney will be able to write the promissory note. There will be some cash outlays. Have to record title transfer and mortgage and pay for title insurance and prorate taxes, etc. Get it in writing on a purchase and sale contract.

Wayne Brooks · Answer

@Sean H. It’s simple....

$100k purchase price

Zero down, $100k note/mtg at xx% interest rate. No monthly payments due, interest to accrue

Full balance, along with accrued interest, due in maximum xx months.

Wayne Brooks · Answer

@Sean H. It’s simple....

$100k purchase price

Zero down, $100k note/mtg at c % interest rate. No mo thylakoids payments due, interest to accrue

Full balance, sling with accrued interest, due in maximum xx months.

Sean H. · Answer

is a closing attorney capable of writing up this paperwork, or will i need another type of attorney?

Michael Plaks · Answer

@Sean H.

I'm not an attorney, so I can't give legal advice. I have seen variations of your scenario implemented, so it should be possible. It is still a sale for a consideration, the secured note being consideration. And yes, it is a form of owner financing with deferred payments.

Paying "0" dollars for a property?

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