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Old 06-17-2008, 06:05 AM
 
Location: Florida
23,155 posts, read 26,059,920 times
Reputation: 27887

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I've tried online research but haven't been able to get more than a vague idea of what it might 'cost' us to sell a mortgage we hold.
Our buyers were desparate to secure our house for themselves but have one of their own to sell.
After close to 2 years we were thrilled to have a buyer.
We took back the mortgage (approx. 20% down) for 18 months figuring that gives them plenty of time to get theirs sold, hoping it would happen a lot sooner.
Now we're thinking that, at our age, even 18 months is a long time and are giving thought ot selling it.
Anybody have any idea of what discount we might be looking at for such a short term loan?
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Old 06-17-2008, 09:06 AM
 
69,368 posts, read 63,862,710 times
Reputation: 9383
Quote:
Originally Posted by old_cold View Post
I've tried online research but haven't been able to get more than a vague idea of what it might 'cost' us to sell a mortgage we hold.
Our buyers were desparate to secure our house for themselves but have one of their own to sell.
After close to 2 years we were thrilled to have a buyer.
We took back the mortgage (approx. 20% down) for 18 months figuring that gives them plenty of time to get theirs sold, hoping it would happen a lot sooner.
Now we're thinking that, at our age, even 18 months is a long time and are giving thought ot selling it.
Anybody have any idea of what discount we might be looking at for such a short term loan?
It will be tough to find a buyer due to the short period of time. Those that buy mortgages want to see a payment history of usually 12 months in order to not take a deep discount. The 20% down will help out greatly though as long as you can document that money actually changed hands.

What type of $ are we talking about for the balance? A $25,000 loan vs a $250,000 loan deals with 2 different types of buyers.

Other options are you sell the balloon payment, or you sell the 18 months payment, or a partial, sell the balloon and the last 6 months of payment, its not an all or nothing when reselling mortgage notes.
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Old 06-17-2008, 09:44 AM
 
Location: Florida
23,155 posts, read 26,059,920 times
Reputation: 27887
Balance is $198 at 6.50% and we'd just as soon sell entirely (husband is 70 and not in great health)

I thought the only interest (no pun intended) we might get at all would be sooner rather than later since the interest is all there is to offer and not much time to get it
though new doesn't give much of their payment history.
We are renting back for 6 months

Oops.....I'd better check to make sure we didn't put in an no early prepayment penalty(OK by us)
That would make it even less attractive, wouldn't it?

Think we might just be stuck with this one,yes?
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Old 06-17-2008, 04:32 PM
 
69,368 posts, read 63,862,710 times
Reputation: 9383
Quote:
Originally Posted by old_cold View Post
Balance is $198 at 6.50% and we'd just as soon sell entirely (husband is 70 and not in great health)

I thought the only interest (no pun intended) we might get at all would be sooner rather than later since the interest is all there is to offer and not much time to get it
though new doesn't give much of their payment history.
We are renting back for 6 months

Oops.....I'd better check to make sure we didn't put in an no early prepayment penalty(OK by us)
That would make it even less attractive, wouldn't it?

Think we might just be stuck with this one,yes?
Actually a prepayment would make a mortgage note easier to sell because the ROI for any buyer, if prepaid would be recouped faster. The problem is your going to end up taking such a deep discount for the note, especially given todays market on real estate (and the age of the seller) that I'd quickly suggest you just hold onto the note. (example, a buyer might pay $150K for the note, but if it was repaid in full within 4-5 months at $198K thats a huge profit margin in such a short period of time that a buyer of mortgages would love to see a pepayment on the note.

Did you pull the buyers credit or any idea what the score would be?

I used to know buyers of these notes, but I've lost touch with them. If you want to PM me, I'll see if I can locate their information again and run the scenario past them.
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Old 06-19-2008, 03:37 AM
 
Location: Florida
23,155 posts, read 26,059,920 times
Reputation: 27887
Thanks so much for all your help
Guess we're best off hoping our buyers have a 'sooner' sale on their house or being satisfied with the extra interest income ourselves.
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