Hi everyone, I’m new to the site and to REI. I’ve studied REI for a while and decided to jump into it.
My question is this: On an owner financed deal, is the property technically in my business’ name? I’m a little confused on this whole process and would appreciate some guidance from anyone.
Thanks in advance!
Do you mean you’re selling a property with owner financing, or buying a property with owner financing (ie a lease option or land contract)? And when you say “is the property in my business name” do you mean whose name is on title?
Sorry… I guess that was an unclear question. I am looking to buy a property and the owner is willing to do “owner financing”. My question is will I technically “own” the property? My goal is to purchase a “starter” property (4-8 unit multi-family building) and increase the value over time to be able to use as an asset when purchasing another property.
I would make sure the Owner really “owns” the property. It likely that the owner currently has financing in place and is just going to “wrap” your financing around the current financing. make sure that the property is deeded into your name and also make sure that a seperate company is receiving your payment and sending it to the lender that actually owns the note. It would be a bad thing if you made payments for a few years and then the “owner” stops making payments and your property gets foreclosed on.
Duston, there are several ways to do owner financing. If you want to own the property, you get a warranty deed and you sign a promissary note to pay.
Not many sellers will do owner financing, and almost none of them will give you a warranty deed unless you make a very substantial down payment-- like maybe 30% down.
Otherwise, the title stays in the seller’s name and you get an option, or a land contract.
Seriously, you need to consult a lawyer who specializes in real estate. You are going to obligate yourself for a huge amount of money, and you must understand what you are signing before you sign it.