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This thought just occurred to me.
If my lender drops out and I can't get a mortgage for this house we are suppose to close on Wednesday.... Would it be wise to ask the sellers for sellers financing> The house has been sitting vacant for a year and obviously they are not in a hurry to get money....
What are the chances????
Do they own the home outright or does it have a mortgage? Many mortgage contain a "due upon sale" clause. This means that the owner must pay off the mortgage if it is sold, even with seller financing.
As a side note, as an owner, I would be very reluctant to provide seller financing to someone if the lender "dropped out." As an owner my criteria for providing seller financing would be stricter than most lenders, and my interest rate would be higher. That's just me though. I'm sure there are nicer people out there.
On the other hand, what is the market like in your area? If it favors buyers, the owner might consider seller financing if they could afford to do so.
I financed a land sale myself. I think it's much more common to see land handled this way than a home. Probably because there's not much that can be done to lower the value of land but a house can be trashed completely.
This thought just occurred to me.
If my lender drops out and I can't get a mortgage for this house we are suppose to close on Wednesday.... Would it be wise to ask the sellers for sellers financing> The house has been sitting vacant for a year and obviously they are not in a hurry to get money....
What are the chances????
First of all, remember that closing on a house is often a hair-raising experience for the buyer! At least in my experience, it never seems like it is really going to happen, until it does. Often closings have to be delayed for various reasons. So, try not to worry.
Some sellers would never consider seller financing and yours may be one of them - - it doesn't really matter what the chances are, so much as what your seller will or won't do. Work with your buyer's real estate agent and be honest. He/she may be able to help you to determine what the seller might or might not do, as well as what other options might be open to you.
I've bought land on a seller financed 24 month contract, and paid it off within 120 days when the seller started to sound "flaky" about honoring the deal (I wanted them to not build the roads into another development across our 80 acre parcel, and they were platted across my parcel. The sales contract specified that no roads would be built, but the seller was apparently not going to honor his contract while he still "owned" the parcels he'd sold to me).
I've sold two homes on "contract to deed" sales contracts. For both places, the buyers defaulted on the note and I wound up having to evict them and go through an expensive process to reclaim and restore my properties for resale. At this point, I'd be very reluctant to go into the "banking" business again ... if a buyer doesn't have the money to complete a deal (or substantial equity at risk up front into a place), or a lending institution won't take them as a risk, I'm not going to go there, either.
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