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I found a property in Hawaiian Acres that is being offered through owner financing. I've never owned only rented so I have a lot of silly questions. The owner of the property uses a company called "Preferred Contact Management" out in Hilo. I would like to use a escrow company, so to my payment are being recorded and the title is in a safe place and available when it is time to close. Question: Do I as a buyer find the escrow company or open an escrow account and do escrow companies offer title insurance. So, before signing contract, I would use a title company and do a title search and then sign contract and open an escrow account and get title insurance.
Let me know if I'm missing anything.
Thanks!
Humanity is not what you can get out of others but what you an give to others.
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I have seen some people scammed by the Owner Financed routine. Doesn't mean you are looking at a scam but you do have to protect yourself. As I recall one of our local scam artists, whose initials are A.Y., wrote some pretty rough paper. Miss one payment and the property reverts, a very high interest rate, over priced and other stuff. A good talker.
Sounds like you are careful. Good. Get a lawyer to look over the deal. There are some legal services groups you can sign up for that have reasonable monthly fees that can review a document.
Good luck.
Assume the best and ask questions.
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Thank you for the advice.
Humanity is not what you can get out of others but what you an give to others.
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in my case of purchasing land via owner financing, i used a realtor to help complete all the paperwork.
is it true that the buyer's use of a realtor is essentially free, and the seller pays the realtor fees?
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This is how I would go about approaching this. Since I have never heard of "Preferred Contract Management" I would call up "First American Title" in HIlo, and ask them if "they can hold title in escrow and have me make payments directly to them in an owner finance arrangement?". IF they cannot, then I would say, "Who does this in town? Have you ever heard of company called Preffered Contract Management? Then, after doing this type of research, I would go back to the seller and tell him/her that you will do the deal, but want to use "so and so" because of "x,y, and z". GL, and let us know what happens! BTW, you can look at the "Conveance OFfice website" in Honolulu and get the title info for 5 dollars. You can look at the actual deed, but of course this isnt "official" like a title search that costs 314 dollars at American Title, but it is pretty good. Also, you can just go to the window at the county offices behind the registry of motor vehicles, and get the tax printout for that TMK.
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Smart Julie. I'll let you know.
Humanity is not what you can get out of others but what you an give to others.
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I have bought property via seller financing three times here on the island. Once in the '70s, again in 2001, and again a few years ago. All three times were parcels that are not candidates for conventional financing and the sellers already knew that they had to be creative in order to sell. In two cases location.. off power, undeveloped, no actual vehicle right of way, etc. was the issue. The third was a case where the covenants made conventional financing unavailable. I was able to negotiate reasonable terms at current market rates all three times, and one of the sellers was the state of Hawaii itself. In all three cases the purchase agreement was for so much down (25% - 50%) with interest only on the balance due for 5 years with a ballon (buyout) at the end of that time. All's to say that in my experience this is a real method of buying or selling property that is not easy to get conventional financing for.
