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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] Insulate your title from your buyer's current judgments... Posted by Ward-CA- on March 13, 2004 at 2:53 PM In Reply to: Seller carry back posted by c shore on March 11, 2004 at 2:56 PM : Need help-I am considering a seller carry back with $10,000 down at 9% interest with a balloon due in 3yrs. I found out from the Title Company that he has 2 judgements filed against him if the Title Company agrees to do Title insurance subject to and buyers agree What risk am I taking if they can't get a loan in 3 years ? ================= The buyer's current abstract of judgments will automatically attach to the title of the property the minute you transfer it into his name. Thus, any seller carry-back mortgage or trust deed you take back from him to secure the balance of your unpaid equity in the property will be junior in seniority to his two abstracts of judgment!! The solution is simple. Have him create a legal, but fictitious entity, like a title holding trust (THT) or corporation or LLC, to take title to the property instead of him personally. Then you can carry-back a mortgage from his LLC and it will only be junior to your current mortgage(s) and not his present judgments. So if you have to foreclose 3 years from now, because he can't refinance, you won't getting your property back with his two abstract of judgments against it! Hope this helps. Follow Ups: Purchase Money Priority Travis-CA 11:11 PM, 03/13/04 (0) Post a Followup: Name : E-Mail : Subject : Comments: : : Need help-I am considering a seller carry back with $10,000 down at 9% interest with a balloon due in 3yrs. I found out from the Title Company that he has 2 judgements filed against him if the Title Company agrees to do Title insurance subject to and buyers agree What risk am I taking if they can't get a loan in 3 years ? : ================= : The buyer's current abstract of judgments will automatically attach to the title of the property the minute you transfer it into his name. : Thus, any seller carry-back mortgage or trust deed you take back from him to secure the balance of your unpaid equity in the property will be junior in seniority to his two abstracts of judgment!! : The solution is simple. Have him create a legal, but fictitious entity, like a title holding trust (THT) or corporation or LLC, to take title to the property instead of him personally. : Then you can carry-back a mortgage from his LLC and it will only be junior to your current mortgage(s) and not his present judgments. : So if you have to foreclose 3 years from now, because he can't refinance, you won't getting your property back with his two abstract of judgments against it! : : Hope this helps. Optional Link URL: Link Title: Optional Image URL: [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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