Why should I use a Bond for Deed or Land Contract?
A Bond for Deed/Land Contract are types of owner financing, but with much more security for the Sellers because the title remains in the Seller’s name. The easiest way to think about this type of transaction is that it functions much like a rent-to-own plan, whereby the Buyer and Seller jointly agree to enter into a contract to sell the property IF the Buyer makes a certain number of payments for a specified period of time.
If the Buyer fulfills the terms of the contract, then the property title will transfer to the Buyer. However, in case the Buyer does not make the payments specified within the Bond for Deed contract, then the Seller does not have to foreclose to regain control of the property because the title was never transferred to the Buyer.
Why should I use a third-party servicer for my Bond for Deed or Land Contract?
A neutral party between Buyer and Seller helps protect both parties during the loan process, handles all the administrative tasks, and accurately records payments. This independent and impartial means of tracking payments minimizes the risk of funds not being applied correctly.
The servicer accepts payments from the Buyer and when payment is verified, notifies the Seller that payment has been made and distributes the funds as the contract stipulates. At the end of the year, the agent files a report with the IRS for mortgage interest paid and mortgage interest earned.
Can I move my servicer agreement to you if I am managing it myself or another party is servicing it?
Absolutely. We are able to take loan management over from other parties or from the Seller financer directly. If you choose us to take over the loan, we will send out a detailed list of what information is needed to accurately service the loan.