Seller holding note
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Seller holding note (by Dan [NY]) Oct 10, 2017 5:30 PM
       Seller holding note (by Deanna [TX]) Oct 11, 2017 5:12 AM
       Seller holding note (by S i d [MO]) Oct 11, 2017 7:30 AM
       Seller holding note (by tryan [MA]) Oct 11, 2017 9:57 AM
       Seller holding note (by mark [NY]) Oct 14, 2017 6:30 AM

Seller holding note (by Dan [NY]) Posted on: Oct 10, 2017 5:30 PM

Looking for thoughts on how to have attorney to structure this deal. My concern is monthly prepayment of principal. The details are purchase of $129,000, 20% down payment, amortized over 15 years. This gives a monthly payment of $763, Interest of $29,853 and principal reduction of $61,750 during the ten years with a balloon of $41,450. We have an agreement of being able to pay down the principal monthly, if I desire.

How does the attorney write this up in the agreement so buyer and seller are on the same page? How is this managed on a monthly basis? Thoughts are appreciated.

Seller holding note (by Deanna [TX]) Posted on: Oct 11, 2017 5:12 AM

Many attorneys have programs that supply all their legal forms. You fill in the variables-- names, numbers, dates, that sort of thing-- and pow! You have a standard legal text.

Have you asked your attorney if he's done this kind of form before? As long as you can say, "I want A, B, and C to be included in the agreement," which you seem to be able to do, he should be able to provide the verbiage that connects all those ideas, and does it in a way that's compatible with standard county/state/federal/whatever law.

Out of curiosity, it seems that you're the buyer, but you're providing the attorney to write the agreement as well? Is the seller cheap/poor/unconnected/inexperienced and doesn't have his own guy to rely on?

Seller holding note (by S i d [MO]) Posted on: Oct 11, 2017 7:30 AM

It should be fairly simple. Be sure the following are clearly spelled out:

1) no pre-payment penalties

2) how often interest is calculated (daily, monthly)

Once that is established, any spreadsheet program and/or mortgage calculator will give the same answer as to how much is due, and how extra payments are applied. Typically, an additional principal payment is exactly that: it reduces principal only. Interest due is calculated on a monthly basis as how much balance outstanding remains on the date the regular payment is due.

Daily interest is only calculated if you are doing a full pay-off. That's how it works in every loan I've ever paid off, anyway.

Math always works once you set the parameters.

Seller holding note (by tryan [MA]) Posted on: Oct 11, 2017 9:57 AM

Remember the Dodd Frank act requires your lawyer to be a "licensed and registered mortgage originator" ... I am sure he'll have no problem. ;)

Seller holding note (by mark [NY]) Posted on: Oct 14, 2017 6:30 AM

one --146.185.xx.xx

Subject: RE: Seller holding note
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Seller holding note
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