trying to buy some land

Discussion in 'General Conversation' started by South Grand Laker, Jun 30, 2009.

  1. South Grand Laker

    South Grand Laker New Member

    Messages:
    723
    State:
    Oklahoma
    i have found some land that a friend of mine is trying to sell , i want to know what the best way is to go about it im a first time buyer and don't know the proper procedures or the best ways to go about doing so, i could go through a small bank but have heard the interest rates would be higher, he has said that he would be willng to owner finance , just wondering what the smartest options would be if anybody would know , i can give further info on the subject if needed, thanks alot
     
  2. Mark J

    Mark J New Member

    Messages:
    9,407
    State:
    Four Oaks, NC
    The first place I would start is a deed search to make sure it has a clear deed. I would hire an attorney for the deed search. Money well spent in my opinion.
    If he wants to owner finance don't do it on a handshake. Again do it through an attorney. Nothing wrong with owner financing just protect yourself.

    Where you got to be real careful in a owner financing deal is making sure the loan and paperwork are in order so that while you are paying on the land and he retains the deed to the land that he cant tie that land up in a second mortgage or some other personal loan.
    That is where your risk is.

    Use an attorney.
     

  3. oh no

    oh no New Member

    Messages:
    11,108
    State:
    Indiana
    When we bought these 17 acres in 1974 or so,, the banks would not loan money on bare land,,,we had to have our old house as collateral too,,,,

    I don't know if they are still that way or not,, of course heck I was only 23 or so back then and did not have much of a credit history,,, now I would just sign my name for the money,,, no collateral at all....

    I have never dealt with a land contract in my life,,, do what Mark sayes and go threw an attorney,, When we bought this land, there was no realtor involved,, and we went to an attorney,,, he got the paper work right,, lawyers are good for something,,,

    In fact that is the only time I can say a lawyer did me any good,,, all my other dealings with them have led to all the lawyer jokes...

    Do you know what happens when a lawyer takes Viagra?? He gets taller. :smile2::smile2:
     
  4. olefin

    olefin New Member

    Messages:
    3,908
    State:
    Texas
    I'll go with Mark, get a real estate attorney!

    We bought lake property and didn't go through an attorney. While our house was in construction our next door neighbor filed law suit claiming part of of our property under the Adverse Possession law. (legal theft after 7 years) She claimed several years before we bought the property she had use a strip of it to store and burn trash. There were no signs of that when we had the lot surveyed. The previous owner testified he never saw her use the property and he checked it several times a year. But she won the law suit, we took it to the State Supreme Court, they ruled in her favor. We had purchased Title Insurance but it has a clause that doesn't cover property line disputes. We could have sued our surveyor but he died during the trial. One thing in our favor, the court didn't allow her to claim any lake or road frontage.
     
  5. South Grand Laker

    South Grand Laker New Member

    Messages:
    723
    State:
    Oklahoma
    thanks alot guys i do need help in this subject, i like the owner finance thing, i d just be worried if something happend if i got hurt at work or lost my job, after putting down so much and missing a payment i could get screwed out of my down payment and such, its not an incredible amount of money either i think im gonna try to get it for around 35,000
     
  6. oh no

    oh no New Member

    Messages:
    11,108
    State:
    Indiana
    I knew and old hillbilly that owned a junk yard by Indy,,, he sold it several times on land contract and was planning on selling it several more times,, as he knew folks would have trouble with the payments and he got to keep the down payment money plus payments....

    He thought of it as a joke and a money maker.
     
  7. Jollymon

    Jollymon Well-Known Member

    Messages:
    4,618
    State:
    Wilm .N.C
    If contract is drawn up u stand no more of a chance losing it on a owner finc.than to a bank i would not think but i don't know the laws there 'get you a lawyer an ask those questions ,if your friend wants to owner fin. if lawyer says yes thats what i would do
     
  8. coolbreeze70

    coolbreeze70 New Member

    Messages:
    397
    State:
    tennessee
    I would suggest also ensuring that there is no clause on early pay off. People often fail to think about this or think there is no way ill be able to pay it off early so who cares. Later money comes along and they cant pay off or have to pay a penalty to pay off early. Remember even if you throw a few hundred extra at it here and there you would be amazed at how much you save in the long run.:cool2:
     
  9. Mark J

    Mark J New Member

    Messages:
    9,407
    State:
    Four Oaks, NC
    I've got a friend that has made a living selling the same 5 or 6 houses over and over.
    He knows it's the people with bad credit that want to owner finance for the most part.
    He gets a hefty down payment up front and always winds up owning the property again.
    He told me that every 7 years those houses pay for themselves. After that it's gravy.
     
  10. South Grand Laker

    South Grand Laker New Member

    Messages:
    723
    State:
    Oklahoma
    that's what i'm not looking forward to happening, im pretty sure i cuold make payments all the way through, but you know how life goes sometimes, but anyways whats the worst thing you would have to do is go get a loan from the bank to help make the payments if you knew you couldn't right????? or wrong?
     
  11. azcataholic

    azcataholic New Member

    Messages:
    1,384
    State:
    arizona
    Hello Matt, I agree completely with Mark's suggestion. An attorney who handles real estate transactions could on an initial consultation give you the guidelines, concerns, etc. He would also give you an estimated cost for his services for the transaction. Think about it, owner financing, who is the first person he is going to protect. He may not be disclosing some of the important factors of the property, not properly surveyed, zoning, septic system. Would he pay for a home inspection by a licensed inspector, ask him in person. I have a real estate license in Hawaii, my main advice spend the necessary cost to secure the property for you.
    In most cases any bank would want to hold the first mortgage on the property. Just my thoughts.
     
  12. TITANSFAN2104

    TITANSFAN2104 New Member

    Messages:
    577
    State:
    Smith county TN
    you can go to a "hometown" bank!! they will do the credit check and tell you what rat your at, then tell you how much DP if any! Then they will tell you it has to have a meeks and bounds, if not youll have to get a surveyor. Then as far as making sure the deed s clear - i peromise you they or the current owner will have to take care of that!! go talk to them they will tell you step by step what to do and if everything goes smoothly you can close in 2-4 weeks- depending on appraisal value vs. selling price!!
     
  13. TITANSFAN2104

    TITANSFAN2104 New Member

    Messages:
    577
    State:
    Smith county TN
    most banks or lending companies require all of this and more!! they will let him know what he needs to do or freddie mac and fannie mae will never shgn off on it!! especially in this day and time !! that why so many homes have been forclosed because appraisers were giving a higher value than the properties worth then when the owner looses it the bank is stuck with a $100,000 house that they lent $150,000. thats why all these mortgage comps have filed bankruptcy and alot are under thewatchful eye of the government !!
     
  14. TITANSFAN2104

    TITANSFAN2104 New Member

    Messages:
    577
    State:
    Smith county TN
    well not exactly!! if your credit record states that you are paying 4 or 5 payments a month and you buy this land for example- you net 4000 a month household- you pay a 700 land payment and 500 car payment and wifes 500 car payment a 200 cc bill and brand new boat payment @ 300- thats 2200 they will take that and compare it to your 4000 a month net and i think its as long as its less than 65 percent maybe 55 ??? cant remember the exact - your good to go!! so if you are at 65 percent then need another loan your out of luck unless your credit is excellent!! 2200 is a little over 50 percent of your net income although they may do it on annual income