When writing a contract on page 1 of the Sales Contract it asks for the finance details. These can be gotten from your lender.
For down payment, only put in percentage.
For First Trust, only put in the balance to equal 100%.
Sales Contract Page 1 Example:
Sale Price: Your offer price.
Down: 20% (do not put in dollar amounts, only percentage.)
First Trust: 80% (do not put in dollar amounts, only percentage.)
Second Trust: ( blank)
Seller held Trust: ( blank)
Total Financing: 80% (do not put in dollar amounts, only percentage.)
Seller Subsidy: ( leave blank )
If you want to offer less than list price, this is where you would put in the dollar amount that equals the buyer’s closing cost. That way the seller pays buyers closing cost at settlement. How much are the closing costs? Ask the lender.
(If you go over the amount of total closing costs, there is no change given to your buyer, so be accurate with a dollar amount, not percentage.)
Finance Contingency Addendum:
Put in what the lender states as to the terms, but even a reasonable guess is ok. Because this is an estimate of what might be. If the lender can give a better interest rate, the buyer can change to that rate. But if you put in you want a 1% interest rate over 30 years, then the buyer can obviously get out of the contract because he could not get that kind of loan.
Can you change lenders?
Yes. You can always change lenders unless it‘s just to get a loan denial letter to get out of the contract based on financing. Changing lenders means you have to start all over on providing paperwork. One deal had a bank loan that fell apart two days before settlement. Loan Office Andy Sikora 703-505-2999 took over and got it to settlement. Good job Andy.
This has been another exciting “Training in a Minute“.