All Forum Posts by: Victor Mammarella

one more bullet point

Will having multiple mortgages affect my credit?

• · No, having two mortgages will not negatively affect your credit. If anything it will slightly improve it due to more on time payments being recorded. Mortgages affect your credit when there is an initial credit pull made or a payment is missed.

Hey, BP friends many sellers and agents don't understand seller finance and have a lot of questions.  I made a Q&A to attach to all my offers to help explain the process and make it less confusing.  Let me know what you guys think and if you'd take out or put more info in. Thanks!

Why seller finance?

• This may be beneficial to a seller so they can get the price they will be happy with, while giving the buyer a more affordable option.

How Does it work?

• The seller will receive a down payment that will go directly to the seller and cover their closing costs. The seller will keep the Deed for the contract’s duration and continue to have the mortgage payments in their name. The buyer will make payments directly to the mortgage company including insurance and take out their own insurance policy on the property. Any additional money agreed upon will go directly to the seller. At the end of the contract the buyer will make a balloon payment of the remaining balance to the seller, which will also pay of the mortgage.

What if the buyer stops paying?

• If the buyer stops paying the contract will be terminated and the right of possession will go back to the seller. The seller will keep the down payment and any additional payments made as this is nonrefundable.

Will this affect me getting another loan?

• · It is unlikely to affect your next purchase. The monthly payments will cover the existing mortgage. This will cancel out the mortgage debt for your debt-to-income ratio. Most lenders think of seller finance as a rental but with much more security due to the down payment. Please verify this with your lender and let them know your plans before making your decision. If your mortgage company does not accept seller financing as income, I will provide a reputable broker that is more familiar with seller financing to aid you in the purchase of your new home.

Will my mortgage be called?

• · This is another unlikely scenario but is important for sellers to verify. When a property transfers owners their mortgage is normally due. However, since the Deed is still in the seller’s possession this is typically a non-issue for most financial institutions and their acceleration clause will not apply. Please contact your mortgage company to verify before accepting the contract.

Hey Alex, I flip houses and have long term holds in the area.  Id love to connect with you and make a deal happen.

I have some experience with seller finance but am not an expert.  I'd recommend at least having a big enough down payment to cover the closing costs.  Since obviously the buyer will not want to lose money. 2nd make sure your offer can cover their mortgage payment.  I'd start with 0 or no interest and say your open to negotiation to help find a solution for both parties.  I think its good to start a dialogue and let them know you want a win/win deal.

I'm currently making a deal where I pay principal only. That way I can offer a higher monthly payment and all the money goes to me.  Anyone have experience with this? Kind of going the opposite direction of OP

 Hey joe, I've been putting in quite a few offers on 10% seller financed deals. Not having alot of luck.  Do you seem to have better luck targeting active or expired listings and off market?

In my experience all the ones i've worked with take hard money loans. Most large hard money loan and large wholesalers already have relationships from sharing flipping clients.

 You don't need to pay it off.  I have a deal right now where The mortgage is under my name but the buyer pays the mortgage.  If the buyer doesn't pay the SF deal is terminated and I keep his down payment.

Has anyone had good experience with seller finance lately?  The market in my area has been extremely slow since the last interest rate hike.  Many properties have been on the market 60+ days.  I'm thinking it would be a more advantageous time to do seller finance in this slow market. Thoughts?