Borrowing Money Privately - Documents Needed To Close A Bothell Real Estate Deal

When you are looking for a loan for your Bothell real estate, and you are having trouble borrowing money from the bank or other financial institutions, you may have to consider your other options. For some, these options might include not getting their ideal house or investment property. For others, they may contact a private lender. Should the lender feel interested and believe that the venture is relatively safe, they may lend you the money.

A promissory note is one of the papers that you will need to sign in order to obtain the loan. It is the agreement that has been reached by both parties and is considered a legal obligation once signed. The note contains important details about the transaction for both parties. You will have to pay back the amount loaned and interest in the time stipulated on the note.

This is another document included that ensures that you live up to the agreement and meet the required deadlines. This is known as the mortgage and usually lists the Bothell real estate you are purchasing as security in the event you fail to make your payments.

A few things to consider including in the note if you are buying a house through a private lender are:

The substitution of collateral clause means that should you wish to sell the property before the note has been paid off, you may substitute another property or asset of equal value. This means that if you are unhappy with your purchase, and wish to get rid of the investment or dwelling, you will be able to under the substitution of collateral clause. This is, providing you have the collateral.

The prepayment clause is something that is very important in terms of paying off your loan and saving money. Over years of paying the money back to your private lender, the interest will amount to thousands of dollars. Having the prepayment clause included means that you can pay the note off before full maturity of the loan and save a lot of money in interest charges.

You should include both the buyer and seller when you are looking for insurance on your Bothell real estate property. The policies should be separate with an owner’s title policy and a lender’s title policy.

Another thing that you should include in the agreement is a disclosure statement. This statement basically informs your lender of your exact intentions for the property.

Looking to sell or purchase real estate in a Bothell community or new construction in Bothell contacts Adrian Willanger 206 909-7536 for more information.

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