All Forum Posts by: Brittany P.

Yeah, we're definitely down a rabbit hole. Okay, sounds like we need to review the current mortgage. I was under the impression we could use either CFD or DOT and avoid triggering. Thanks, you all have been super helpful!

Basically trying to get cash flow minus the landlording. I wonder if deed of trust wouldn't accomplish all this without the uncertainty of a CFD? Can you close through deed of trust without triggering due on sale?

I think what we're looking to do is very similar in concept to wrap/subto, but I think the big difference is that we keep the deed through CFD...? My understanding of subto is that the deed transfers a la a standard closing. For this first one we really need to keep the deed so our lender doesn't call the loan on us. Notwithstanding what you and Chris have been saying about the possible pitfalls of CFD, it seems like our best bet would be CFD so that we keep the deed. Even with deed of trust, can't the lender call the loan since we've closed with the buyer at that point?

Final question on this (for now, anyway): if we end up going CFD, couldn't we sit on it for a year, then turn around and sell the contract? That cashes out our lender and we keep the profit, no?

Ugh. Don't want to make things to easy in the real estate game. But if I do record CFD I should be good right? I thought recordation could run into the low hundreds but nothing crazy...?

 That's something I've been really curious about?  My understanding is you're good if you're going through an established loan servicer or if you're servicing under a certain number of notes/year?  But I'm sure it varies wildly state by state.  One of these pros must know the answer.

Only advantage for us with CFD on our one property is that we de-landlord ourselves without having our loan called on us. We could just straight up sell the place, but we're trying to avoid paying commissions and we likely wouldn't get what we'd like for the place. With our other MD properties sounds like we'd want to go note/SF because our lender on those properties is much more flexible and won't call the loan.

Thanks, you all have been really helpful on this.

Uh oh. Now I feel like an instigator. I think there's some confusion caused on my part because I was asking about two separate CFD situations:

1. We're considering buying a CFD in NY; we had a 30-year title report run and it was free/clear. So I guess the debate is Chris' vs. Peter's thoughts about title insurance. I get the merits of both arguments. De facto I'm having a lot of issues finding a title agent who even gets the CFD concept as a "closing" process without deed transferring, and so I'm wondering if it's even worth pursuing title insurance for myself (I think Jamie was also saying it might not be worth it).

2. We're also considering getting one of our current properties under CFD. Our properties are in MD, so interested in what you have to say about CFD difficulties in MD. For the first property we want to consider, we know that we have to do CFD instead of seller financing because our current lender would definitely call the loan if deed transferred. For our others, the lender we worked with would probably be cool with deed transferring under a seller financing agreement. So thoughts on CFD vs SF in MD (sorry for the alphabet soup)?

Okay, very helpful.  Thank you both.

Jamie, how are you converting CFD to mortgage? QCD to the Buyer/Vendee? And what's the advantage? I thought the whole general advantage to CFD was at least a slightly easier process for taking possession of the property if the Buyer defaults; a process sort of mirroring the eviction process, unless the state forces you to go through a standard foreclosure process.

Also, my earlier question about baking language into the contract that guarantees the Buyer's interest through our existing title policy was meant for getting one of our current properties under CFD. We're looking to sell but would like steady monthly payments and the ability to take back property in event of default (basically we're trying to de-landlord ourselves). Thoughts on: 1) trying to cover Buyer through the contract under our existing title policy; and 2) selling through CFD versus just listing it?

Finally, what's your website, Jamie?

Thanks to both of you. I like getting into all the minutiae on this. I'm definitely having trouble dealing with the few insurers and agents I've spoken to who seem to scratch their heads when I discuss a policy covering buyer/seller in a CFD. Part of it is because I keep using the term "closing" in quotes. How would you all describe a CFD execution? It's hard for me to use the word closing per se because deed and legal title aren't transferring at time of contract execution. Is it still considered a legit closing?

This might be a question for an attorney, but to circumvent the whole rigamarole of getting a new policy issued for buyer/seller, could you work into the CFD that in the event of title defect, Seller will reimburse Buyer's interest/equity in property in the event that the Seller's policy is exercised? Or is that crazy? For example, if I have a policy for my $300k property and a little old lady presents legit title (maybe mine was based on a forgery?), I get paid out by my policy and am required to pay Buyer for the $200k equity they've built up. Would that be a simpler way to handle?

Also, what about my earlier rookie question about tax transfers: I assume they're transferred in the state where the property is located?  How are they typically paid, just by contacting the county treasurer's office and working through them?

Yeah, what you're saying makes me wonder how much it's actually worth trying to climb the title insurance tree, or whether I just hang my hat on due diligence/title report.

For transfer taxes, dumb question: they're paid in the state where the property's located, right?  Not my home state (for out-of-state purchases)?