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Co-Sign for Owner to Close the deal - to #43

43 Co-Sign for Owner

When a seller needs money but is credit-challenged, consider co-signing for a loan for him. In exchange, ask the seller to add your name to the deed. Take a buy out option and offer one to the seller. Verify that payments are made by having the seller send you monthly payment receipts. If the seller defaults on the loan, exercise your option and buy him or her out.

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Charles Parrish

Posted by Charles Parrish on 08/19/2007 12:43 AM

Comments (3)

cosign for owner, credit challenged

3 Comments on Co-Sign for Owner to Close the deal - to #43

AUG

2007

This sounds like a risky proposition for a lot of situations. May work for some ok, but for other situations~ risky.

Yes, you are right Bob this technique could be risky. The purpose of these tips are to stimulate creative thought. Tip #43 may not work in every situation, but it could be called on at times.

Suppose -----A seller is in foreclosure and is about to have his equity of $80,000 wiped out. You have great credit, but you do not have the $10,000 to bring his payments current.

You now may want to consider #43, you get a mortgage for $10,000 plus another $10,000 for repairs. You stop the auction, make repairs and are now in a position to take a portion of the existing equity.

It is important to make sure you have all your agreements signed, that the seller understands the transaction and make all disclosures.

Yep, real risk when doing deals with folks who are not making their mortgage payments, but as you know there are many good folks who are in bad situations.

Charles

AUG

2008

I agree in the risk factor, however; it can also bring in cash if the buyer offers: Cash per mo. to the cosigner, signed addendum to pay back monies if a default, and use of a credible lender. *I currently have an investor offering properties to homebuyers that can finance with a 640 or above. a co-signer is needed in most cases. However; the lender has solid properties, will do any and all rehab & focuses on quick refinancing when initial loan is received. This quickly eliminates the cosigner from burden, and is quite useful. I would like to partner with an investor to prequal for a small $42,000 loan. Once received, the loan can be quickly refinanced to me. *Also, this investment company has several available, solid low cost properties. Since it's target is primarily investors, you can purchase the property in your name, and owner finance for a little more than the loan vs. cosigning. Please see: www.cashflowinvestmentservices.com And contact me ASAP if interested. I have the prequal loan packet

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