Now that lending has gotten more difficult and credit scores (in my opinion) have gone crazy. Land contracts seem to be on the rise.
I really worry about these for several reasons. I am sure there are people who have done them successfully, but I am still shying away from them.
What I worry about:
- That the owner of the property has a loan for the property and in his loan agreement is states he can not do this
- That the owner of the property does not keep up his own mortgage payments - therefore goes into foreclosure
- That the owner of the property does not keep up on his payments for property taxes
- That the agreed purchase amount is not what the property will appraise for when ready to buy the home
- The the buyer never gets credit ready
- That the buyer does not take care of the property like they should
To me there are many risks on both sides. I would rather see my client go to credit counseling. Then be able to buy once their credit is repaired.
The only statistic you want to be part of, is the home buyer statistic!
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