I couldnt find an answer to my question anywhere else so here it goes.
Anyway, for example, I hear people say you should rent out the house then sell it while “carrying the note on the property”.
What is a note? What does it accomplish?
Ive tried goodle and the search function, and still cant find it.
WRONG FORM… SORRY… MODS PLEASE MOVE.
Hoosier, when you use the word “note” in that context, you are speaking about a promissory note. That would be a contract that outlines money owed, how much, the interest rate, due date, etc.
Beyond that, I am not quite sure what sort of situation you are trying to get information about.
I think the idea behind “carrying the note” is holding the loan on the property. For example, if you own a property and have no loan on it, you could sell with your financing and “carry the note.”
The situation you describe is putting the house in service as a rental, then later selling the house to your tenant with seller financing some portion of the sale.
The lease arrangement could be either a straight lease or a lease with option to purchase. The sale to your tenant could be financed by (1) buyer’s new mortgage loan for a portion of the purchase price and you hold a second mortgage for the balance of the purchase price, or, (2) a wrap-around mortgage for the full purchase price, or, (3) a contract for deed for the full purchase price.