By Admin on Oct 23, 2009 in Renting & Real Estate
bunnie asked:
I am offering owner financing to a relative for property I own out of state. The interest rate will be set at 3% for 5 years. I was planning to print out an amortization chart for us both to follow, but I need help determining what legal paperwork I need for the actual transaction showing the payback agreement. Also, do I need to file this in the state it’s being sold, and do I need to notarize it?
What exactly do I need to know to make this a legal transaction?
I am offering owner financing to a relative for property I own out of state. The interest rate will be set at 3% for 5 years. I was planning to print out an amortization chart for us both to follow, but I need help determining what legal paperwork I need for the actual transaction showing the payback agreement. Also, do I need to file this in the state it’s being sold, and do I need to notarize it?
What exactly do I need to know to make this a legal transaction?
You need to part with some money to hire a real estate lawyer to make sure you do this right.
Help Is Here! | Oct 25, 2009 | Reply
You need a real estate lawyer. Also, you are not charging enough interest – the IRS could charge you additional tax based on what you should have earned and view the difference in earning as a gift back to your family member.
MadMan | Oct 27, 2009 | Reply
If you the property is in WA State, there are some LPO forms that you can get online to help you fill out the forms. It’s best that you hire a real estate attorney to do this as they will identify some ‘what if’s’ in the paperwork to make sure you have this discussion with everyone before hand. You don’t want to be caught in a sticky situation.
Roz | Oct 30, 2009 | Reply