How long does it take to close with owner financing when the owner has a mortgage?

Deal Score+2

In other words, what time-consuming activities have to happen before closing, when the owner providing the financing is already satisfied of the property’s value and condition, so there is no need for additional inspection, appraisal, etc.?

I assume the key issues are paying off the owner’s mortgage, recording the owner-financed mortgage, and getting the title transferred to the new owner. But do those get done before or after closing?
The owner’s liquid assets plus the seller’s down payment will add up to enough to pay off ther owner’s mortgage.

  1. Reply
    March 31, 2012 at 5:12 am

    Nothing is Kosher until the first loan is paid off, until that happens the existing loan has priority interest over the property

    How is the seller paying off the first?

  2. Reply
    March 31, 2012 at 5:39 am

    since that is called a “wrap,” the closing should take 1 day; since
    there is no outside financing involved.

    your seller has to make sure he is not causing an ACCELLERATION
    of the loan.

    Meaning, sometimes, it is a document that looks like a lease
    purchase–the words of the agreement have to be perfect to
    not permit the lender to call the loan due.

    ask about that.

    then, be ready to close the next day.

    or, ………the seller is doing something different entirely!

    or the seller is paying off the mortgage! This year, I have not heard of
    any seller having any equity left after doing so!!!!

  3. Reply
    David Z
    March 31, 2012 at 6:38 am

    if you want title insurance (and you do) that could take a couple of weeks. other than that this could be done in a few days.

    just schedule a closing with title company.

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