So a seller and I have come to an agreement on terms on a property and I literally had to raise funds from family to obtain the down payment. Now that I have the EMD down payment. I just realized there are closing costs involved. What parties are involved at this stage of the transaction? Unfortunately, I didn't account for the closing cost at the time, but wasn't sure if i needed it now or even needed it at all, since I'm going directly to the seller. Since there is no realtor and commissions involved I guess what im trying to get here is, what would be the 1,2,3 steps to close, for example (1. the EMD is now sent to the sellers title company etc etc..) which parties are involved and whats the closing cost im expected to come out of pocket on my end?
Im a realtor but i guess since im a realtor buying my first house as a cashflow property directly with a seller.
Rental Property Investor · Erie, PA · Member since 2018 · 6k+ posts · 9k+ votes
7y
@Raden Mantuano
Normally Your earnest money will go toward the down payment at close . Because the seller will be holding the note till it’s paid ,you will save on some of the fees till it’s all paid off years from now . Do not deal with an realtor . Have an attorney who’s done land contracts right out the article of agreement . Cover your butt and practice due diligence . Seller finance is a powerful tool to get into investing if it’s done right
I love your hustle in spirit! I would highly suggest kind of getting mobbed up with a good realtor and have them help you with the contract
so contacted a realtor in that area to help through that transaction would help? or just a realtor in general? im a realtor, just one who hasnt bought directly with a seller before.. just not sure whats the difference
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
7y
Well then you should know the basic closing costs.....title search/insurance, deed/mtg recoding fees, closing fees, mtg docs prep, etc. and also which party typically pays what in your market. Your contract should have detailed who pays what. Talk to the title company for a prelim estimate.
Well then you should know the basic closing costs.....title search/insurance, deed/mtg recoding fees, closing fees, mtg docs prep, etc. and also which party typically pays what in your market. Your contract should have detailed who pays what. Talk to the title company for a prelim estimate.
Rental Property Investor · Erie, PA · Member since 2018 · 6k+ posts · 9k+ votes
7y
@Raden Mantuano
Normally Your earnest money will go toward the down payment at close . Because the seller will be holding the note till it’s paid ,you will save on some of the fees till it’s all paid off years from now . Do not deal with an realtor . Have an attorney who’s done land contracts right out the article of agreement . Cover your butt and practice due diligence . Seller finance is a powerful tool to get into investing if it’s done right
Rental Property Investor · Las Vegas, NV · Member since 2018 · 9 posts · 6 votes
7y
@Raden Mantuano congrats on almost hitting the finish line. I plan to purchase my first property via seller financing I’d love to follow how everything turns out. Good luck
Real Estate Broker · Cleveland, OH · Member since 2017 · 719 posts · 658 votes
7y
EM is the part of all your payments out of pocket: down payment to the seller and closing costs.
Most important, someone has to write all the same documents like with the usual mortgage: the note and the mortgage(that the seller entitled to repossess your house in case of default on the note).
After everything is ready, the title company will give you HUD-1 or whatever it is for the land contract, where will be $$ you bring to the closing.
BTW, seller will credit you with the prorated taxes up to the day of closing. It might help with some closing money