- NEW!
by 000 on August 5th, 2009
Having a 'note' on a property means another person has a financial interest ( or mortgage ) in that property, registered against the current owner. The property cannot be sold or traded without honoring the note first, so if the property was purchased, the deal must include clearing the title for the next owner, in other words paying the note off before the sale proceeds. In a trade, since no money changes hands, the new owner could be liable for the value of the note above and beyond the value of the trade. Most note holders would demand to clear you as the new note holder before allowing the trade or sale to proceed. In real estate, the note is the same as the mortgage, and has the legal right to be paid off first, by the current owner.
by Sherri on August 5th, 2009
Let's put this into numbers and see if it makes sense. #1 Your house is worth $100K and paid for. Sam's house is worth $250K, but he owes $100K on it, so equity is $150K. You would have to give Sam your house plus $50K if he swaps with you.
#2 Your house is worth $100K again, but now Sam's house is worth $125K and he owes $75K, so equity is only $50K. Sam would have to pay you $50K plus his house.
hope this helps.
PS the note, more than likely, would have to be refi'd by you!The transfer of the home would probably cause the bank to 'call' the note.
My mother passed away recently, how do i remove her name from our house warranty deed
by mo2657 on October 2nd, 2009
| 2 people like this
I would like to trade my property for another property of greater value. My property is all paid for but the other property carries a note. Can you explain to me how the different equities and different values in the properties are handled in a trade?
by Patrick on August 4th, 2009
| 1 person likes this
Seeking long term house swap in Santa Monica for our 2 homes.1)Mexico, Sea of Cortez-walk to warm water beaches and 2)Tucson, 4 acres-horse property-hiking, bird watching in the Catalina mountains. Use both homes, desert and sea. Where to advertise?
by Anonymous on July 12th, 2009
| 1 person likes this
Would you rather live in the heat of Australia or the cold of Canada or Alaska?
by PrairieWind on November 16th, 2009
| 13 people like this
You're reading I would like to trade my property for another property of greater value. My property is all paid for but the other property carries a note. Can you explain to me how the different equities and different values in the properties are handled in a trade?
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Comments
The note would be paid off during escrow via refinance.
by Sherri on August 6th, 2009
yup - - as in your answer too.
by 000 on August 6th, 2009