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Owner Financed Home

4 1/2 years ago I purchased an owner financed home from an individual who had set up a family trust as the mortgage company. He had about 10-15 homes owner financed and everything thing was deeded over to me with the i's dotted and the t's crossed. 2 weeks ago he passed away and now another family member is taking over the trust. I am concerned that my loan will be sold off to a real mortgage company without my input and would like to re-finance before any of this happens but my credit is horrible after going through a layoff at my former job. The house is the only thing I could keep. Is there anything out there for someone like me? by johnjohnson560 from Round Rock, Texas. Oct 3rd 2013 Reply


John Moran (TheHomeMortgagePro)
#6 ranked lender in Colorado - 655 contributions

John, As Ken stated, even if your loan is sold, the terms can't change. The family member who took over the trust may have a hard time selling those loans, depending on the quality of the loans themselves (documentation, verification, etc.).As far as refinancing, there are more programs out there for bruised credit than in recent history, but the details matter. "Horrible" credit doesn't sound very promising, unfortunately. It is probably best to speak with local mortgage professional to see if you would qualify for any current loan options. Best of luck!

Oct 3rd 2013
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Ken Burrows (mortgagesforamerica)
#19 ranked lender in Nevada - 572 contributions

When were you laid off? If more than 12 months ago we may have an option for you under FHA. However even if your loans are sold off the new lender can't raise the rates and terms on you any more than the original note states. So you are protected there. The only thing that would change is who you are making your payments to. If you would like to discuss all options you can give me a call: 888-320-7888 - www.MortgagesforAmerica.org - Ken Burrows

Oct 3rd 2013
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Hey John, just how 'horrible' is your credit? I can go down to a 560 mid-score with an FHA or VA loan. I live in Leander, but work in Austin for a Texas mortgage bank. Let me know if you think that your score might work and I can try and help you out.

Oct 3rd 2013
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Henry J Daniels, CMPSI, CMHS (HenryJDanielsNationalMortgage)
#14 ranked lender in Texas - 128 contributions

Hi John, note buying and selling is as common as selling non-owner financed mortgages. Although you most probably don't have a say in the matter the terms of your note cannot generally change and the note probably can't be called in unless you violate the terms of the note such as nonpayment. I would recommend you seek the advice of a real estate attorney just to be safe. Refinancing is probably not in your best financial and emotional interest (due to your credit) at this time.

Oct 3rd 2013
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Cody Velkovich (Cody_NRL)
#1 ranked lender in Texas - 92 contributions

I originally answered your question from my cell phone, which didn't log me in, so you didn't have my contact info. I'd be happy to talk to you about what it takes to get this scenario done, or if you'd like, my office is off of Far West and MoPac. I'm posting my original reply below:"Hey John, just how 'horrible' is your credit? I can go down to a 560 mid-score with an FHA or VA loan. I live in Leander, but work in Austin for a Texas mortgage bank. Let me know if you think that your score might work and I can try and help you out."

Oct 3rd 2013
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Josh Lund (Josh_Lund)
#47 ranked lender in Minnesota - 113 contributions

As many have stated. Your rate and term cannot be changed if sold. Hope that helps!

Oct 3rd 2013
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Dave Metsker (DaveMetsker)
#38 ranked lender in Oregon - 2,317 contributions

You have nothing to fear from the new holders of the mortgage. The terms do not change when the beneficiary (owner) changes. Just keep making you payments on time, and keep copies of the checks. That will be proof of your on time payments, when your credit has improved, and you are ready for a conventional loan.

Oct 3rd 2013
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William J Acres (William_Acres)
#2 ranked lender in Arizona - 8,092 contributions

Your terms cannot change if the loan is sold.. keep in mind that most seller financed homes have some sort of balloon payment.. meaning they will not finance you for a full 30 years.. so hopefully you are fully aware of the terms of your loan.. if you have to pay them within a certain amount of time, and you don't', then you run the risk of the trust calling the note due.. if you cannot pay them, either in cash or by refinance, you could possibly lose your home.. .. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

Oct 3rd 2013
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Sarah N. Montes (TXPRIDE)
#185 ranked lender in Texas - 18 contributions

Please call me, I can help! I have access to investors who can refinance the property for you.(800) 515-0445

Oct 11th 2013
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