Legal Question in Real Estate Law in Illinois
contract for deed
I have a co-worker of mine that is wanting to sell me her home so she can get a mortgage for a different home and my question is, are we able to do contract for deed or how can we go about taking over payment? My co-worker already has a mortgage on the home and she said she does not want to turn a profit she just wants a different mortgage for a bigger house and my husband and I are very interested but we have filed bankruptcy about 3 years ago. Is this even an option for us?
2 Answers from Attorneys
Re: contract for deed
If your co-worker needs to pay off her existing mortgage, this will not work. If she doesn't, it will work as a contract for deed as long as she continues to use your payment to pay the mortgage and the mortgage company does not find out that she has sold the home to you. If the loan is assumable, it is a matter of your credit history before and also after the bankruptcy. Bottom-line is you are asking for a situation that can easily result in complications. Therefore, you need to hire an attorney who can protect your interests.
Re: contract for deed
Unless your co-worker's mortgage is FHA or VA, it is very unlikely it is assumable. Unless it is assumable, you cannot just "take over the payments." Additionally, if there is a mortgage, it is unlikely that your co-worker would be able to sell the property to you on contract. You need to discuss your situation with a real estate attorney. The costs of not following the rules are very, very high.
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