I know someone who purchased land in CA 5 yrs ago. She is having a hard time

Asked by Joanna Schmidtchen, Tallahassee, FL Tue Apr 29, 2008

keeping up with the payments (about 5 years left on mtg). A friend has offered to take over her payments for 6 months or so, but she does not know how that would entitle them or what to offer them to be fair. Any suggestions here?

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Jed Lane, Agent, Petaluma, CA
Wed Apr 30, 2008
I would see it as a note with tilte to the property as collateral. The friends note is recorded, the payback and interest are agreed upon by whatever method is needed, from sitting down over coffee to having attorneys work it out. The owner should not have give title or or even a fractional interest in the property to be able to get the money.
You can help by getting the note recorded in California by getting the person you know in contact with a title company in your area that does business in California.
That's my two cents.
1 vote
Frank Diaz, Agent, Honolulu, HI
Wed Apr 30, 2008
That is a tough one. If I were putting in th money, I would say:
1. Pay back within 3 years or the property must be sold.
2. If the property is lost, I get paid the same as whether the friend sells it or not. So the note is not tied to the property.
3. Since your friend has almost finished paying for it, I don't think that person should give up ownership interest. Unless, she doesn't oay it back, in which case, that would be the only thing left (See #1).
4. Payback of 10% interest (flat amount, not APR) plus principal on the loan, within 24 months after the 6 months of the subsidized payments to your friend. It is high risk, I think.
This is definitely an area for an attorney. I think it is an equity sharing situation, but only if the owner can't pay it back. Not sure how to write that up, just my 2 cents worth.
1 vote
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