Need Help Selling my Home

[primetime]

Looking at a 40 acre homestead, but need to sell my current home first. Has anyone on here ever sold there home by owner? I'd like to save the Realtor costs if possible. Need some help on what paperwork I'll need and what to expect. Any good websites that you've used - that are legit would be great.

[yankee]

What exactly are your goals? I know this may sound like an odd question seeing as you are selling your home to buy another.

Is it to just get out of the existing loan?

It is to turn as much proffit as possible?

Do you have any equity?

With answeres to those questions, I can give you a step by step aproach to how I sell homes and property.

[primetime]

My goals...

Well - I guess you'd say it's to get out of an existing loan, I've got a good amount of equity built up, but need that for a down payment and fix up money on the new place.

I'm not trying to turn as much profit as I can, just trying to get a good amount to do the above. I'm getting an appraiser in there this week to give me an idea of what it's worth.

I know some good Realtor's, but don't want to spend $9,000.00 if I don't have to. Figure I can do most everything they can do. And if it comes down to it could pass that savings onto a potential buyer to sweeten the pot a bit. Could not come down and pay a realtor - wouldn't have enough money towards the new place.

[yankee]

I most likely would sell with a Land contract or wrap around loan with at least 20% down(should be pleanty for your next down payment)

I would advertise everywere including a sign in your front lawn. If you know a hungry realtor, he most likely can work out the deal for 1K on the side. It is very simple.

There is some risks, but the rewards are far greater than a conventional saleand you get a whole bunch of cash up front.

I would use a loan specialist and not a credit union or bank for the finacing of your new property.

If you have great credit(you can buy the new house without closing the deed on the first house(also use a private lender through a mortgage broker), there is the option of selling your home with a lease option.
I would sell at ten percent more than your apraised value and at least your new deposite amount needed in a non refundable lease option fee.

I would then hope that they don't use the "Option to buy" and make another non refundable lease option fee a year or two down the road.

Anyhow, those two methods of selling is what I personaly would do.

If you just want to get out of the loan, hire an agent.

[primetime]

Wow - a lot of things I know nothing about. Do you work in real estate?

You said you would use a loan specialist instead of a credit union or bank. Explain that? What or whom would be considered a "loan specialist" and where do I find such people?

Are any of these things you mentioned similar to "contract for Deed"? That I've heard of.

Only issue is my current payment is around $900.00. No one will rent or lease my place for that around here. Will I need to refinance it back out to 30 years to get my payment down?

Also who is this type of selling targeting? People that can't get loans?

[yankee]

Jun 29, 2010 8:09:49 GMT -5 primetime said:

You said you would use a loan specialist instead of a credit union or bank. Explain that? What or whom would be considered a "loan specialist" and where do I find such people?

Motgage broker.
They specialize in nothing but loans with all sorts of funding. Much easier to get a second mortgage after selling your home under terms. Also, your local banker may be a nice guy, but proboly not finacialy smarter than you and very likely not understand what you are talking about when explaining you sold your existing home on terms with a lease option agreement or a Land Contract. Bankers as a general rule, just know banking and are employee and yes it makes a big difference, because a Broker understands how far ahead you are in passive income and very little to no risk as so will the investor they are dealing with.

[Admin]

I buy and sell quite a bit of property but don't have any experience with selling something I have a mortgage on so don't have much to offer here. The one good thing about selling your primary residence is that you can sell your primary residence every 2 years without paying capitol gains tax. For a guy that builds his own place this can be a very profitable procedure to earn lots of tax free dollars. I presently have one parcel that I sold a few years ago on a (land contract) A land contract is different than just (holding a mortgage) on a sold parcel. With a land contract (the seller) retains ownership until the parcel is paid off, then the deed gets transferred to the new owner. If my buyer defaults on his payments it's a lot easier to take the land back than if the deed has been transferred and then I have to go through court repossessions etc. There are possible complications however to this. Since I am still owner of the land, I am still liable so I have the buyer carry a million dollar liablity insurance on it with me being the loss payee.

Going through a realtor is sometimes worth it because of the convenience of them picking up the loose ends. I presently have several parcels in a realtors hands BUT I also retain the right to sell the land on my own where I pay them nothing. I also retain the right to take it off the market at any time regardless of the contract with no penalties, AND I knocked the s**t out of their commission. Just because they have a standard form with standard rates doesn't mean it's written in stone. You can work with a realtor under YOUR condotions. If not, shop for another realtor. If they want to sell your home they'll work with you. Their standard form is much like the sticker price at a car dealership. There's room to dicker.

[yankee]

Jun 29, 2010 8:09:49 GMT -5 primetime said:

Are any of these things you mentioned similar to "contract for Deed"? That I've heard of.

Yes a Land contract and contract for deed is the same thing. Great option for a serious buyer, but not a profitable as a Lease Option.
Usualy you have someone who wants the property, has a good down payment, but can not or does not(myself, I don't buy with convetional loans anything but 0% autos) another conventional loan in there name. You hold the note and deed until it is paid off. Basicaly you can get fair markey value or slightly higher under these terms along with an interest rate of 6.5%-10%(Should be a good amount higher than your existing loan). You get the benfit of passive income in the form of interest(That is tax free income!) plus a sum of cash for a deposite, plus most banks will recognize that you no longer own the first mortgage because it is sold under a contract for deed. You loose the write off of depreciation in most cases if not all.
If they do not pay, you forclose. If this happens, you still gained equity and passive income.

Lease option is not quite the same as renting and not quite the same as selling. It is in my opinion, the best option as far as profit goes.
Lease option boiled down: You find a buyer who has some money,but can not get a conventional loan. (all sorts of reasons). These people as a general rule are total different than renters. They want to own, take care of and live in a home. They are 100% responsible for lawn, roof, leaky toilet, insurance, taxes etc... They are planning on buying and keeping this home.
Anyways, how it works is simple. You find a buyer who wants to do a lease option(VERY EASY). They will pay your set price and give you a lump sum of cash as a non refundable lease option fee. Maybe $2000.00, $5000.00 $10,000.00 all depending on the situation. Usualy you write it up with a closing on the deed in 2 years. Some people will want one year, two years, etc...
If you do it right, you usualy make some passive income( collect more money than your existing loan is at very low tax rate) plus have the non refundable lease option fee. Sometimes you give them this fee back if they close within one year, two years, etc.... The time that goes by is usualy just enough for them to qualify for the loan and when they do, you have gained equity, made a small amount of passive income and collect a lump sum of cash.

When they close, you get all your equit you had plus the ten percent you added to the asking price, plus the equity you gained while they paid down your existing mortage.

The best part of a lease option is that maybe only 40-50% actualy use the Option to buy. Maybe they did not fix there credit, maybe they did not save enought to have the 10-20% equity gap needed for most BANKS today. Maybe they don't like the house, etc...
At that point, you can renegotiate or even better, Find another buyer and collect another NON REFUNDABLE lease option fee.

If the buyer does not pay, you evict quickly and find another lease option buyer. You gained equity, still can write off depreciation, and collected a non refundable lump of cash.

On both of these deals, you make far more money that a coventional sale and the work is not much more. There is some risk if you are over extended finacialy. (Basicaly if the buyer does not pay, you may need to pay both morgages for a month or two until you find another buyer)

Selling this way is all about making passive income and a lot of money over a long period of time, but with little taxed income(passive) or income not taxed at all(interest)

[yankee]

Jun 29, 2010 8:09:49 GMT -5 primetime said:

Also who is this type of selling targeting? People that can't get loans?

People who can not get a loan or people like myself who do not want a conventional loan on anything other than low/no interest autos.

Sometimes investors, but most likely not in your exact case because you want all the equity you can squeeze out of it.(even if you do not realize it.)
people who want to just get out of a mortgage do not have equity. Often times have massive amounts of negative equity.

[yankee]

You would not necisarily have to refinace, but if you decide you want long term passive income, it may be a great idea. Crunch numbers and talk with an accountant that deals with investors(not employees with W2 forms)

You may be able to pull the equity that way for your next home and make long term passive income.

Also note that any mony being produced after the loan counts towards income for a second mortage. A mortage broker realy likes someone with good passive income and minimal risk(far less risk than collecting a weekly paycheck(job security and tax rate)

[primetime]

Thanks everyone.

One thing that just came up is a relative thinks they would like our place. Problem is she might not be able to get financing. I don't like working with relation, but if I can come up with the right type of agreement this might work out in my favor and hers since she may not be able to get a loan the conventional way.

[yankee]

Jun 29, 2010 9:39:15 GMT -5 primetime said:

Thanks everyone.

One thing that just came up is a relative thinks they would like our place. Problem is she might not be able to get financing. I don't like working with relation, but if I can come up with the right type of agreement this might work out in my favor and hers since she may not be able to get a loan the conventional way.

That is the perfect example. Family or not, write a formal and legal agreement and if they do not pay,evict, foreclose. It is a land contract, make sure to record the loan. Easy to do.

[yankee]

You might want to consider buying under terms, subject to the existing loan. Could save you a lot of money and time and years of payments.

If they have equity, then you could buy uner the contract for deed.

If they own the property outright, they may want to hold the note and collect some hefty tax free income.

This is how I buy properties. I am standing in our retail store now that has just 4 more years of mortgage that was bought under contract for deed.