I heard from a realtor that selling a house via owner financing/land contract is now illegeal in Texas and some other states as well. Is this fact?! If I owned a house free and clear of any mortgate payments, shouldnt I be able to do or sell it however I want? I understand how doing a "wrap around" mortgate is somewhat controversal, but what about if I own the house? Im confused. Can someone please inligten me about this situtuation?

No. Anyone can sale their own property about any way they wish and Owner finance is viable in all 50 states.

Suggest you find better sources for information.

What Texas did and a few other states have done is to place more controls on thing like Contract for Deed and some similar processes that are often more of a scam than beneficial transaction. This is unfortunate because many of the processes could be viable methods if both parties fully understood and accepted their pluses and negatives.

What the Texas legislature did was indicate THEY feel; too many of its citizens were to inept/ stupid/ ignorant to make decisions for themselves.

Here (Colorado) it is illegal for Realtors to write ILC (installment land contract/contract for deed). Attorney's can write them for you if you want to sell FSBO that way.

I think you will find, that that prohibition is only applicable if the agent has no ownership interest in the property. An agent with ownership interest can and they often do make use of these delayed ownership transactions.

could you tell me how owner will carry works. how you would write the contract when buying . thanks

No as Realty Check states Anyone can sale their own property about any way they wish and Owner finance is viable in all 50 states.

The problem with wrap around mortgage is you are still responsible for the first mortgage regardless of whether or not your client pays. Plus if you flat out transfer ownership there usually there is a due on sale clause in your note. That is something your lender may or may not enforce. As to the agent/broker the problem is usually with owner financing and or wrap around type sales there usually is not enough money transferring hands so to speak for the agent/broker to get paid. I hate to say that but that’s the reality of the situation.

Depends on the state, in most states like here in Florida only a real estate attorney can actually write a contract. Here in Florida we have attorney approved fill in the blank contracts we use. But in its simplest form owner financing is just like any other sale. Except for instead of say Bank of America being the lender the previous owner is. There are risks involved. However in most cases the costs are less. It’s more popular when interest rates are on the high side. For example let’s say in a particular area the best interest rate this buyer can get is 9%. The owner agrees to hold the mortgage at say 6 or 7%. Every one is happy for the buyer received a lower interest rate and the sellers is say getting a better return then say his bank where he/she may only be getting 3 or 4%. And the seller does not really need the cash to be liquid. So when the interest rates are high owner financing becomes a little more popular. In addition owners are usually easier to get approved with for the owner just says yes or no.

Every time I see this it makes my head hurt....

"Anyone can sale their own property"

Please folks, it should read...

"Anyone can sell their own property"

The word is "SELL"

xJoker25xx

I a Real Estate Broker licensed in Minnesota and Wisconsin. I just closed last week on a free and clear for-sale-by-owner condo in Texas (where I am not licensed). I wrote my offer on forms approved by the Texas Real Estate Commission. All of their forms are available for free at:

http://www.trec.state.tx.us/

Look for the forms tab at the top. You can find the Seller Financing contract about half way down on the forms page. This may give you some ideas of how these deals work in Texas.

We wrote our deal using forms from this page and had a title company that happened to be owned by an attorney draw up the mortgage, deed of trust, etc. We paid regular closing fees, but nothing extra for the attorney to review all the docs (which was done anyway because the firm owns the title company). We all met same time for the closing and were out in 20 minutes.

Hope this helps.