Wrap Around Mortgage What is a Wrap Around Mortgage?

Wrap Around Mortgage What is a Wrap Around Mortgage?. Subject-To Investing: (Real Estate Wrap-around mortgage & Subject To for Real Estate Investing)

Wrap Around Mortgage What is a Wrap Around Mortgage? video duration 2 Minute(s) 26 Second(s), published by OverhageInvestments on 30 05 2012 - 19:26:43.

What is a Wrap Around Mortgage? - http://overhageinvestments.com/faq/what-is-a-wrap-around-mortgage/ Hi
This is Greg Overhage
In this video, we are going Guerra Days Law Group, Houston Real Estate Attorney Rick Guerra discusses what a wrap around mortgage is in the state of Texas, and how it can be .

This is a land deal we bought at auction
This is fat me breaking it down at our office
It's one of the first videos I ever did using a white board
This real estate . Subject-To Investing: (Real Estate Wrap-around mortgage & Subject To for Real Estate Investing) How To Buy House Without Using Credit or Bank
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What is a Wrap Around Mortgage? - http://overhageinvestments.com/faq/what-is-a-wrap-around-mortgage/

Hi. This is Greg Overhage. In this video, we are going to discuss what is a wrap around mortgage and what would you use it in. A wrap is a very creative alternative to leasing wherein the seller or an investor wraps a new mortgage around an original mortgage.

To make this a little clearer, let's start with an example. We have a property with a value of $250,000, the mortgage is $210,000 with an existing interest rate of 4%. The seller sells the house to a new buyer for $260,000 with a down payment of $10,000. This results in a wrap of $250 at an interest rate of 6%. The seller keeps the $10,000 down payment, which covers closing cost. The seller collects the payment of only $250 at 6% of $1,498 a month which is used to pay the existing mortgage of $1,002. This results in a positive cash flow of $496/month, or $5,900/year so it will create a new escrow to cover taxes and insurance as you see this as a financial transfer for the seller. The wrap will also into the house for 4% down in this case, in this very situation. That's a really great deal for the buyer. So, we'd normally structure wrap around mortgage with the provision that the buyer would refinance in 3-5 years or sell the home. If the buyer fails to refinance seller to said provisions to the interest rate or to get the house back, when the home is refinanced, the buyer pays off the original loan and the remaining balance is profit for the seller, in this case, the seller gets $40,000 back when the house is refinanced. This $40,000 is called the backhand profit. Most houses can be sold with a wrap if there's equity in the house.

A disadvantage of this for the seller is that the buyer would stop making payments. In this case, the seller can take the property back, making repairs, and re-sell the property.

Overhage Investments and our team have extensive experience with wraps. This is one of the many strategies that we use to sell real estate challenges. We are real estate investors here to help you reach your real estate goal. Our goal is to fix your problem and let you move on with your life and sell your house fast.

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