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What is a creative home loan?
When someone wants to buy a home, but they are unable to gather enough money to pay for it (cash for equity + loan proceeds), then the buyer and seller are going to have to get "creative" if they are going to be able to close the transaction. Unfortunately, getting "creative" sometimes means being subversive. A common example is the wrap-around mortgage when the seller's mortgage has a "Due On Sale" clause. With this clause, the buyer will not be allowed to assume the mortgage, but must get a new loan. The seller is supposed to pay off the old loan. But, let's say the buyer is not able to qualify for a new loan and the seller is willing to try to keep any knowledge of the sale from his lender. Let's say the seller's loan is at a low interest rate of 5% and has a current balance of $80,000. The seller might agree to sell the house to the buyer for $100,000. The seller accepts a note from the buyer (a loan) for the purchase price of $100,000 (nothing down) with an interest rate of 8%. Each month, the buyer pays the seller who in turn, sends part of the money to his mortgage company as payment on the original loan. To make sure the seller keeps making payments on his loan, the buyer often insists on making payment to an escrow company (or attorney) who will forward a portion to the original lender as a loan payment and remit the balance to the seller. The buyer gets a house he cannot otherwise obtain. The seller has actually made a loan of $20,000 to the buyer (the seller's equity in the property was loaned to the buyer, since there was no cash downpayment). But what does the seller earn on that $20,000 loan? First, he receives 8% interest on $100k each year. That's $8,000 per year. Second, he has to pay 5% on the $80k he owes. That's $4,000 per year. So, the seller is NETTING $4,000 (8 - 4 = 4) per year that he gets to keep. That is a 20% rate of return on his $20,000 loan to the buyer. That's a creative home loan. There are other ways to be creative -- such as obtaining a lease with an option to buy (where the tenant gets credit for part of the rent toward the purchase price).
What are the dangers of selling house on contract?
If a seller and a buyer have already signed a contract, then you have to sell according to the contract. If you want to sell to someone else not on the contract, then you have to get out of the first contract.
If there are 2 purchasers on a home and only one is a first time home buyer can first time buyer get first time home buyer tax credit?
Yes
What advice should be given to a first-time home buyer when dealing with a mortgage broker and real estate agent?
Perhaps, some other colleague can contribute about Mortgage Brokers.I will endeavor to respond on the topic of my expertise:Real Estate Broker/Agents If you are the market for a real estate property, I think you owe it to yourself, and your loved ones, to know the difference between a traditional [seller's] broker and our [buyer's broker] services. In other words: If you wouldn't use your spouse's attorney when filing for divorce, neither should you use a traditional [seller's] broker when buying real estate. Why? Just like your spouse's attorney, traditional [seller's] brokers have a legal obligation to other side's [seller's] best interest and not yours [the buyer]. Unless agreed to [in writing] the traditional brokers mentioned above work for the seller's best interest and not the buyer's. In other words, NOT using a buyer's-broker would be like using your spouse's attorney when filing your divorce. Be sure that you Buyer-Broker can guarantee you they: * Will NEVER list properties for sale (or work for a broker who does!) * Will NEVER represent sellers * Will ONLY represent buyers like YOU * Will GUARANTEE YOU'LL SAVE MONEY * Finally, WILL find you the best home at the lowest cost! Brought to you by:www.thefreenotary.com(718) FREE-NOTARY / 373-3668 and Angel L. Cruz,New York CityLicensed Real Estate [buyer] Broker
What does CTG FROR mean in real estate?
CTG FROR in real estate stands for "Contingent with First Right of Refusal." This status indicates that a property is under contract with a buyer, but the seller has agreed to consider other offers. If a higher offer comes in, the original buyer has the right to match it before the property can be sold to the new buyer. This arrangement provides both parties with certain protections and opportunities during the sale process.
Who gets in more trouble - the seller or the buyer of drugs in an illegal deal?
the seller considering they are the ones with the drugs in the first place
What is a seller's second mortgage?
The seller assigns keeps the first mortgage in his name, the buyer makes payments to the seller to cover the first mortgage and the sellers equity. It's sometimes called "seller financing" or "land contract".
When dealing with a diamond buyer should they quote a price first or should the seller?
There is no right or wrong way for giving or receiving a quote. Often, who quotes first will depend on the buyer.
How does eBay's transactions take place?
First, the buyer either wins the auction by outbidding others or using the buy-it-now feature. The buyer then needs to send the payment via PayPal or Credit Card. Then, the seller will ship the item. Once the item is recieved, either the buyer or seller can leave feedback about the product.
Documentary letter of credit?
A DOCUMENTARY credit is frequently the agreed method of settlement for international trade. The buyer's bank reimburses the seller against presentation of documents drawn in compliance with conditions stipulated in the documentary credit by the buyer. There are advantages to both the buyer and seller when settlement is arranged by documentary letter of credit. First, the buyer knows that payment will only be made if the documents received comply strictly with the terms and conditions of the credit as stipulated by the buyer. Second, the seller knows that payment will be received provided the terms and conditions of the credit are strictly complied with.
What is the meaning of 'third-party software'?
The first two parties are the entity purchasing the software (the buyer), and the entity manufacturing the software (the seller).
Who signs a service agreement first the buyer or seller?
The etiquette of business would seem to favor the seller making an offer of intent to sale a service therfore they would sign the agreement first in good faith that the transaction will take place as agreed.
Why would one choose to use a car broker?
If one was a first time buyer or unsure about how to buy a car then a broker can help by liaising between buyer and seller. It can make the process less stressful and time consuming.
When buying a car if your a first time buyer do you have to put down a down payment?
Depends on the policy (rules) adopted by the seller. It's not a law in most places.
Does the incidence of excise tax effect the buyer or seller?
Excise tax can affect both the buyer and the seller. It affects the buyer in that it makes the goods more expensive for him. It can affect the seller in four ways. First, the buyer might use less of his product because it became more expensive. Second, the buyer might find another source of the same product that does not have the excise tax added on and may switch to that product. Third, the buyer might find a substitute product. And fourth, it can cause such resentment against the government that the seller becomes an bystander who loses. The fourth thing happened in the United States in 1773. England put a tax on tea. The people of the future United States rejected tea and started drinking Brazilian coffee instead. Visits to the old colonial homes display the coffee grinders.
Who signs the contract first the seller or the buyer?
Typically a real estate contract begins with a written offer from the buyer. The offer, to be official is signed by they buyer. From there there seller may make amendments and sign and amended contract, that needs to be approved and the changes are either initialled by the buyer and the seller or a new contract containing agreed upon amendments is resigned by both parties. The signing continues until a final agreement with all agreed changes has been signed by both parties. For further information, see the related link below.
What is a creative home loan?
When someone wants to buy a home, but they are unable to gather enough money to pay for it (cash for equity + loan proceeds), then the buyer and seller are going to have to get "creative" if they are going to be able to close the transaction. Unfortunately, getting "creative" sometimes means being subversive. A common example is the wrap-around mortgage when the seller's mortgage has a "Due On Sale" clause. With this clause, the buyer will not be allowed to assume the mortgage, but must get a new loan. The seller is supposed to pay off the old loan. But, let's say the buyer is not able to qualify for a new loan and the seller is willing to try to keep any knowledge of the sale from his lender. Let's say the seller's loan is at a low interest rate of 5% and has a current balance of $80,000. The seller might agree to sell the house to the buyer for $100,000. The seller accepts a note from the buyer (a loan) for the purchase price of $100,000 (nothing down) with an interest rate of 8%. Each month, the buyer pays the seller who in turn, sends part of the money to his mortgage company as payment on the original loan. To make sure the seller keeps making payments on his loan, the buyer often insists on making payment to an escrow company (or attorney) who will forward a portion to the original lender as a loan payment and remit the balance to the seller. The buyer gets a house he cannot otherwise obtain. The seller has actually made a loan of $20,000 to the buyer (the seller's equity in the property was loaned to the buyer, since there was no cash downpayment). But what does the seller earn on that $20,000 loan? First, he receives 8% interest on $100k each year. That's $8,000 per year. Second, he has to pay 5% on the $80k he owes. That's $4,000 per year. So, the seller is NETTING $4,000 (8 - 4 = 4) per year that he gets to keep. That is a 20% rate of return on his $20,000 loan to the buyer. That's a creative home loan. There are other ways to be creative -- such as obtaining a lease with an option to buy (where the tenant gets credit for part of the rent toward the purchase price).
