can you created a note?

Hi all, i have a quick question…

I was wondering can you created a note if you still owe a mortgage on the property?


I need a little clarification on your question. Did you mean to ask if you can create a note when you sell the property or create a note while you own it as a second lien?


Im sorry that my question wasnt clear but im going to clear it for you…

Now lets say i have a house thats worth 400,000 and i have a 400,000 mortgage, can i still created a note?
I was reading something about a wrap around, but i dont know exactly what it means…thanks for the help…


A wrap around mortgage would be used when you sell the property for more than you owe on the property and the buyer does not have the credit to get a new loan. In the example that you mentioned, you owe $400K (4.5% on a 30 year note) on the property and you are going to sell the property for $450k. The buyer has $20K to put down on the property leaving a balance of $430K of which you owe $400k. Instead of the new owner getting a new loan (bad credit), you could do a wrap around note in which you would create a note for $430K at 6.5% for 30 years. You would collect a payment of $2717.89 per month from your buyer and then turn around and pay $2026.74 to your mortgage company and pocket $691.15 per month.

Now for the disclaimer. I am not a mortgage broker or a lawyer and I have never done a wrap around mortgage. I do not know if you could do this with the property that you have in mind. I am only giving you an example of how a wrap around mortgage might work.


So wrap around is not availble for all propeties?