The big lenders do the following to protect themselves
when they lend mortgage money
Uniformity and Quality. All the mortgages are of uniform quality.
- Appraisal and Survey. The homes have an independent appraisal
of value and a survey to show there are no encroachments.
- Credit Risk. To get the lowest interest rate, the borrowers
must have good credit. If the borrowers have less than perfect credit,
they have to pay a higher interest rate to compensate the lender for
their risk. You can get a
credit report on your borrower on this web site. You can then set
your interest rate accordingly.
- Down payment. All have a cash down payment of around 10% or
have Private Mortgage Insurance to protect the lender against default.
- Income. The loans are made to borrowers who have proven,
sufficient income to be able to afford to repay them. If the borrowers
can't prove their income, they have to pay a higher interest rate.
- Documentation. Are on the same mortgage and note forms
throughout the state, with the same provisions. We have these same
documents available for you to use free.
- Marketable Title. The mortgages have title insurance or the
equivalent.
- Volume. Are sold in bulk in mortgage packages of millions of
dollars.
- Expertise. They are professional and have experts making sure
they get full price.
How do you get close to 100% of the face value when you sell your
mortgage?
By making the mortgage you take back as close to the ideals shown above
and then offering it to a number of buyers to bid on. (Should you ever
want to sell it for cash.)
Let's start out by finding out how much your property is worth.
- A licensed real estate agent will give you a CMA
(comparative market analysis). This is our recommendation. Should you want
to sell your mortgage later you will need a full appraisal.
- You can order an appraisal from a local licensed appraiser for about $300
or get a computer generated
valuation on line.
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