Dallas-Fort Worth Real Estate Investor Club

Owner Carry Contract and Promissory Note

  • 24 Jun 2014 4:03 PM
    Quote
    Message # 1562903
    Michael Mixon
    I'm working on a wholesale campaign, and I've found a possibly tired landlord.  He's a retired gentleman, who's using real estate to fuel his golden years.  He was very compliant when asked questions about the house, the only things he wouldn't answer were "how much will you take" and "how much do you currently rent the house for."

    I get the feeling he won't be interested in selling at a price that would allow me to wholesale, but the house is paid for, and I can sense his main concern is cashflow.  I was thinking about buying this house as a "hold" property, and I was looking for advise on contracts and other paperwork for an owner-carry deal.  

    Thanks,
    Mike.
  • 25 Jun 2014 6:01 AM
    Quote
    Reply # 1562943 on 1562903
    Deleted user
    I'm not a lawyer.  The following does not constitute legal advice.  It is only my own personal understanding, which may or may not be accurate.  Use at your own risk.

    In the TREC Contract, I believe.... 

    Paragraph 3A would be your down payment to the seller, 3B would be the amount financed, and 3C would be the total of the two.

    You'd check Paragraph 4C and fill in the blank line with the same amount as 3B.

    You'd also complete the Seller Financing addendum with whatever terms and conditions you and the seller agreed to.

    I believe the title company will be able to prepare the Note as well as the other documents necessary to complete the closing, especially if the title company has a fee attorney.

    This web site has a video for sale that walks you through the core TREC contract in much more depth for around $50 or $70.  It's well worth it.  And finally, if you have a good relationship with a real estate agent or an experienced investor, you can seek their guidance in completing the other elements of the contract.

    I strongly recommend confirming how every blank in the contract should be filled out BEFORE meeting with the seller.  Speaking from personal experience, it's no fun to be sitting there in front of the seller on the spot trying to figure it out.

    Good luck!
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