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Owner Financing Contract

Used 4,958 times

Owner Financing Contract

Image 1

Prepared for:

[Buyer.FirstName][Buyer.LastName]

Created by:

[Owner.FirstName][Owner.LastName]

This agreement is entered into on [Document.CreatedDate] between [Owner.FirstName][Owner.LastName] (hereinafter “Owner”) and

[Buyer.FirstName][Buyer.LastName] (hereinafter “Buyer”) for the sale of the property located at [Property.StreetAddress], [Property.City], [Property.State][Property.PostalCode] (hereinafter “Property”).

At all times the laws of [Property.State] in which the Property is located will govern this contract. This contract does not constitute a sale contract for the Property. A separate sale contract for the Property must be entered into and executed according to the laws of [Property.State] in which the property is located.

Loan Terms

This contract establishes that, in connection with the Owner selling and the Buyer purchasing the Property, the Owner shall finance the balance of the purchase price for the Property for the Buyer after the Buyer delivers the agreed upon down payment of $__________________ (hereinafter "down payment").

The down payment amount is to be delivered no later than __________________________, 20_____. Failure on the Buyer's part to provide this down payment to the Owner nullifies this contract in its entirety.

The total purchase price of the Property is $__________________, as agreed to by the Parties to this contract. 

The Buyer is/is not (choose one, delete the other) obtaining financing for a portion of the purchase price of the Property from a third party, such as a bank. The Buyer must notify the Owner of any amount of financing obtained from any third party and provide the full name and contact information of the third party within 30 days of obtaining any such financing.

The amount that the Owner will finance for the Buyer for the sale of the property is

$_____________________ (hereinafter “Owner finance”). The Owner shall carry the promissory note for the entire mortgage term of _____________________, expiring on the ______ day of ___________________, 20____ for the amount identified as Owner finance.

The Buyer has submitted a mortgage application to obtain this financing and the Owner has approved the Buyer’s finances.

The financing for the mortgage is to carry an interest rate of ________________. This interest rate is/is not (choose one, delete the other) flexible according to the mortgage rate index chosen by the parties. The Owner and the Buyer have agreed upon ______________________ as the mortgage rate index to govern this contract. Any changes to the interest rate can only be made by the Owner, but must be provided in writing no less than ________ days prior to the change coming into effect.

Payment for the mortgage is due monthly/biweekly (choose one, delete the other) in the amount of _________________________. This amount does/does not (choose one, delete the other) include insurance, taxes, and state, legal, and other fees associated with owning the property. Should this mortgage amount include these fees and should these fees change at any point due to changes in rates being set by the governing party, such as the state tax authority or insurer, the parties will notify each other of any changes that are brought to their attention within 30 days.

Prepayment of all or a portion of the financing extended to the Buyer is allowed and carries no penalties/carries a penalty of ___________________ (choose one, delete the other). 

This agreement is secured by the property. The Buyer’s failure to pay the mortgage payment when due as described in the terms of this agreement entitles the Owner to initiate foreclosure proceedings as allowed by [Property.State] against the Buyer. The Owner has the right to repossess the property after the conclusion of foreclosure proceedings, as outlined and permitted by the laws of [Property.State].

Loan Servicing

The Owner will/will not (choose one, delete the other) hire a loan servicing company to create the mortgage documents and handle the payment processing. The selection of the servicing company falls under the sole discretion of the Owner. Any fees issued by the chosen company for the loan servicing will be handled directly by the Owner. 

The Owner reserves the right to hire a loan servicing company at any time. Notification of the choice of loan servicing company will be provided to the Buyer at least 30 days before payment should be sent to the loan servicing company.

The Owner may change servicing companies at any time without giving prior notice to the Buyer. However, the Owner must notify the Buyer or have the new loan servicing company notify the Buyer of any changes to the choice of loan servicing company at least 30 days prior to the change in mailing address for the mortgage payment. Any fees incurred due to the Owner’s failure to provide the Buyer with notice, either directly or from the service company, and the Buyer’s sending payment to the incorrect address shall be paid by the Owner.

This is the full contract in its entirety. Any additions must be made in writing and amended to this contract with agreement by all parties. 

Signatures

Signature
MM / DD / YYYY

Signature
MM / DD / YYYY

[Owner.FirstName][Owner.LastName]

[Buyer.FirstName][Buyer.LastName]

Owner Financing Contract

Used 4,958 times

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