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Bond for deed - bad idea?
Posted on 6/18/15 at 3:27 pm
Posted on 6/18/15 at 3:27 pm
I am in the process of selling my home and I have a buyer who wants to do this. Has anyone had experience with this? Is it a bad idea? I am still waiting on the specifics of the deal.
This post was edited on 6/18/15 at 3:30 pm
8
Posted on 6/18/15 at 3:30 pm to cdl2006
Depends on your purpose? Are you the buyer or seller? What are the terms? Primary home? Investment property?
Posted on 6/18/15 at 3:35 pm to cdl2006
Why does the buyer want to do it? 99 percent of the time, the buyer can't get traditional financing. Why is that? If he had a short sale a year and a half ago and can get traditional financing in the next 12 months, and he makes a large downpayment, has cash, etc... it might not be terrible.
If he has no money and no credit, run away.
I have seen bond for deeds work in some circumstances very well for all involved, and I have seen it blow up also.
If he has no money and no credit, run away.
I have seen bond for deeds work in some circumstances very well for all involved, and I have seen it blow up also.
Posted on 6/18/15 at 3:44 pm to cdl2006
get a lawyer involved. worth the $250
Posted on 6/18/15 at 6:19 pm to cdl2006
It's a bad idea. Be patient and you'll get a qualified buyer.
Posted on 6/18/15 at 9:18 pm to cdl2006
I wouldn't do it
Posted on 6/18/15 at 9:19 pm to cdl2006
I bought my first house bond for deed. Wife and I were young and had some credit,but not enough. Put $15,000. down on a $65,000. dollar house. Three years later Metairie bank was able to lend us the money to pay off the bond for deed. The key to this working is they have to have a lot of money to put down or I would not consider. If the buyer has no skin in the game, it makes it very easy to just walk away just like they were renting from you. Think of a number that makes you say,I don't care if they walk away. My two cents, good luck.
Posted on 6/18/15 at 11:50 pm to cdl2006
If the bank is not willing to extend credit to the buyer, why should you? Sometimes there is a good answer to that question such as "I had no better option". Get a big enough down payment to make it worth your while.
Posted on 6/20/15 at 9:55 pm to cdl2006
For what its worth... the wife and her siblings did a bond for deed on mother in law's house after she passed. My wife works for lawyers and the ones that do real estate highly recommended to convert it to a mortgage. I'm not sure exactly why they didn't like the bond for deed but I think it had something to do with if the buyer incurred debt against the house the mortgage would be the first to be paid if the buyer was forced to sell the house.
In any case, the buyer was an oil field worker and recently fell behind on payments. The buyer actually did his own bond for deed to get out from under it. Kind of a weird situation but he's caught back up and payments hit the escrow again regularly...
In any case, the buyer was an oil field worker and recently fell behind on payments. The buyer actually did his own bond for deed to get out from under it. Kind of a weird situation but he's caught back up and payments hit the escrow again regularly...
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