Property Q&A in Orange Beach>Question Details

mhuckabee2010, Renter in Orange Beach, AL

Will owner be willing to do do owner finance or lease to own contract?

Asked by mhuckabee2010, Orange Beach, AL Sun Apr 14, 2013

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This is certainly a possibility. Please contact me by e-ma or phone 251-550-7186. Thanks, Betty Crippen
0 votes Thank Flag Link Mon Apr 22, 2013
This property is under contract and plans to close on 04/30/2013
0 votes Thank Flag Link Mon Apr 15, 2013
I do not suggest doing lease purchases. There are simply way too many things that can go wrong with one from either side.

In order to do true owner financing, the owner must own the property free and clear of any mortgages. Very few sellers are going to be in that position.

If the property currently has a mortgage on it, the owner cannot legally transfer the title to a buyer without the mortgage first being paid in full. Most all mortgage loans have a due on sale clause. This due on sale clause requires that the mortgage be paid in full should a title transfer occur.

The buyer is also at great risk on a lease purchase transaction should the seller quit making their mortgage payments. Right now, many sellers cannot afford to make their mortgage payments or simply chose not to continue making them. I have seen where the buyer is making their rent payment, but then the owner is not paying the mortgage. The next thing the buyer knows is that the home is in foreclosure. That means the buyer will generally not get back any of the money they have given as earnest money or security deposits.

It is also a big risk on the buyer. If your credit is not where it needs to be now, there is no possible way of you knowing it will be acceptable in a set amount of time.

Before entering into any type of agreement like that, the buyer needs to make sure that they fully understand the potential pitfalls that could arise. Should the seller default on the mortgage, the buyer could lose ALL of the money that they have invested. Until you are able to purchase, renting is generally the safer option.

Rodney Mason, NMLS #151088
Sr Loan Officer
Prospect Mortgage
825 Juniper St NE, Atlanta, GA 30308
Office: (404) 591-2453
Apply Online at
Licensed in Alabama & Georgia with over a decade of mortgage lending experience.

Prospect Mortgage offers a full selection of mortgage programs including:
Conventional | FHA | FHA 580-639 FICO | FHA 203K Renovation (Streamline & Consultant) | HomePath® | HomePath® Renovation | HomeStyle® Renovation | VA | USDA | GA Dream | Jumbo Financing.
0 votes Thank Flag Link Sun Apr 14, 2013
This home is already under contract as of April 9.

Are you working with an agent to confirm what properties are still for sale? If not, I can help you with that, as properties that are under contract still show as for sale on Trulia until the sale actually closes.

Also, are you asking about owner financing or lease/purchase due to having already spoken with a loan officer for prequalification?

Please contact me directly via my profile to provide your direct contact information so we can discuss your specific situation so I can be better able to assist you in finding something that would work for you.
0 votes Thank Flag Link Sun Apr 14, 2013
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