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Answers (5)
- Jason Wroble, "Mortgagejaw"
- Contributions:107
Very good answer Jason and Terry!!
- Terry Maddrell, "Terry Maddrell"
- Contributions:4
- Jason Bonas, "Jason Bonas"
- Contributions:214
yeah, pretty much... also, the seller takes a loan out and you repay the money to the seller who pays that money to the bank.
(so there is responsibility for 2 loans)
problems include the due on sale clause that the majority of mortgage laons have written in them. Also, you if either party is not making loan payments, or if the buyer is sending in payments but the seller is not forwarding them to the bank (think about how many landlords have rental units in forclosure even though the tenant is paying their rent on time) and the list goes on
-investors use it if they don't have sufficient lines of credit/or cash to purchase investments since often they have numerous ventures and the banks will not give them additional funds for extra projects
-if your buyer is not in a position to buy a particular home without the technique maybe they should look into co borrowers, or cheaper properties
(so there is responsibility for 2 loans)
problems include the due on sale clause that the majority of mortgage laons have written in them. Also, you if either party is not making loan payments, or if the buyer is sending in payments but the seller is not forwarding them to the bank (think about how many landlords have rental units in forclosure even though the tenant is paying their rent on time) and the list goes on
-investors use it if they don't have sufficient lines of credit/or cash to purchase investments since often they have numerous ventures and the banks will not give them additional funds for extra projects
-if your buyer is not in a position to buy a particular home without the technique maybe they should look into co borrowers, or cheaper properties
- Nancy Lee, "An OrderLee Home"
- Contributions:1195
Thanks for explaining, Jason. This has been my weekend for learning new things. So, am I understanding correctly that in a wrap mortgage the seller would remain responsible for the original mortgage?
- Jason Bonas, "Jason Bonas"
- Contributions:214
Welcome to the world of Real Estate...
does your buyer prefer a wrap around mortgage because of problems getting normal financing, or are they an investor, or did they hear the term in a get rich quick video or such
anyway....
A wrap-around mortgage, more-commonly known as a "wrap", is a form of secondary financing for the purchase of real property. The seller extends to the buyer a junior mtg which wraps around and exists in addition to any superior mortgages already secured by the property. Under a wrap, a seller accepts a secured promissory note from the buyer for the amount due on the underlying mortgage plus an amount up to the remaining purchase money balance.
does your buyer prefer a wrap around mortgage because of problems getting normal financing, or are they an investor, or did they hear the term in a get rich quick video or such
anyway....
A wrap-around mortgage, more-commonly known as a "wrap", is a form of secondary financing for the purchase of real property. The seller extends to the buyer a junior mtg which wraps around and exists in addition to any superior mortgages already secured by the property. Under a wrap, a seller accepts a secured promissory note from the buyer for the amount due on the underlying mortgage plus an amount up to the remaining purchase money balance.
my buyer prefers a wrap mortgage I have no idea what this term means
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