If you currently have a home for sale and somebody offers you the full asking price with no contingencies and a large downpayment, should you consider this a deal or a dud? If the details of a Purchase Agreement include an Owner Takeback, be cautious. An Owner Takeback is a loan you, as the seller, make to the buyer to complete the sale. Why would the buyer request a loan from the seller? They may have some problems with their credit that would prevent them from obtaining a loan from a conventional lender or they may be able to get a better rate from the individual seller rather than a large corporate bank. If a bank is not willing to give them a loan, you should seriously reconsider loaning the buyer money. Another possible downside of an Owner Takeback is that the buyer can add unconventional clauses and terms to the contract that would limit the ability of the seller to collect money from the buyer. Make sure you go over any purchase agreement, especially one with an Owner Takeback addendum, with your broker and attorney before signing anything on the dotted line.
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