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     | Saturday, January 29, 2000 - 07:18 am  We are looking into an owner fin. in Az., and these are the terms offered= sale price 245,000., 12k down, pymts @ 8.95% for 5 years. Positives are that there are no points, no qualifying and no PMI. Anybody have contrary opinions or bad experiences that would help us to decide? One concern I have; Can we put a 2nd for pool on a home like this? Can we resell at any time?
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| | Saturday, January 29, 2000 - 08:43 am I'm definitely NOT familiar with AZ laws. However, I don't think you can be prevented from selling, but you could have a PREPAYMENT PENALTY. And of course, looking at the terms, I suspect the sales price is too high and you couldn't sell it for that price if you tried. Hire an appraiser to establish fair market value for a 5% down conventional loan with PMI. The appraisal should be ordered by a mortgage company. PAY somebody like a real estate broker or attorney to review and explain to you all documents prior to signing.
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| | Monday, January 31, 2000 - 08:43 am I'm from Phoenix, I'm pretty familiar with AZ laws, however, I'm not an attorney. Sounds like you have a pretty good deal, however, you need to do your homework. Here are some questions I came up with off the top of my head: 1) What kind of financing instrument is going to be used. A) Is the house free and clear and the owner will deed you the house and secure the note with a standard deed of trust? If this is the case, you will have no problem selling in the future and no problem getting a 2nd for a pool if you so choose. B) Are there existing loans on the property in which case the owner is going to wrap the existing financing. How is the owner going to wrap the financing - a wrap around deed of trust - or - a wrap around agreement for sale. In either case, you should still have no problem selling the house in the future (assuming you have enough equity to handle closing (selling) costs.), however, you will have difficulty getting a 2nd for the pool. This doesn't mean you can't get a 2nd, it just means that not very many lenders will give you a 2nd with wrap around financing. 2) Next, you need to establish a value for the property. I wouldn't go out and hire an appraiser off the bat. That will cost around $300. There are many Real Estate agents around that offer free market analysis. I would get a market analysis from a couple agents. If the price is in the ball park and you want to go through with the deal, then hire an appraiser. 3) If you aren't familiar with the process of buying a home on owner financing, I would definitely suggest getting a professional (i.e.: real estate attorney) to explain the documentation before completing the transaction. Mark mark@valleyhomebuyers.com
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| | Monday, January 31, 2000 - 11:09 am Thanks Mark- good advice. The home is in Scottsdale, on a golf course and is priced about 5k under the current price for that model (builder is in production)so I am not worried about it being over priced, just wondered about a 2nd for a pool. We could pay cash, but of course can make more investing our cash elsewhere. And yes, the house is free & clear, so the owner is simply carrying the paper.
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