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Land Contract

An alternative to a non-conforming loan is the use of a land contract, which is allowed in some states. A land contract is an agreement between a buyer and a seller, where the buyer agrees to make periodic payments to the seller. The title to the property only transfers to the land contract buyer on fulfillment of the land contract obligations.

A land contract can be helpful for those who need time to establish or improve their credit rating. There are only small closing costs, and payment can help establish a good mortgage payment record. This can help establish an overall good credit rating, and it is possible for the buyer to later refinance the land contract with a conforming loan.

On the other hand, there are risks associated with land contracts. Land contract purchases are not necessarily recorded in the public record, and there are no guarantees that the seller will be able to transfer a clear title to the buyer upon fulfillment of the land contract. There also is no lender assuring that the purchase price for the property is justified, and no inspection of the property’s condition.

Another alternative to a non-conforming loan is assuming the seller’s mortgage. By assuming a mortgage, if the mortgage is assumable, it is possible to save on closing costs, and may allow you to obtain a favorable interest rate.

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Cindy Baughn, CRS,SRES,ABR,GRI,TRLP,PT50
Broker/Owner-Cindy Realty

"A Trusted Name in Real Estate Since 1995"


Phone: 210-445-1230
Email: ForSaleByCindy@gmail.com

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"...you understood the difficulty of the situation and how much this house needed to be sold this summer, and so you jumped in with two feet and did more than ever could have been expected...to say thank you is simply not enough...it was your heart, your kindness and your loyalty to me and to the project that touched me the most." Eileen Eberhardt Thompson
Cindy is one of the most talented professionals I have ever worked with. April 20, 2010, Will was Cindy's client Will Duke
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I had the honor and pleasure of working with Cindy Baughn while I was the Team Leader for Keller Williams Legacy in San Antonio. Cindy had extensive knowledge and experience as a former New Home On Site Salesperson. She was always available to help her fellow agents at the office. More importantly, and significantly, she provided her clients "World Class" service. She personified the true fiduciary relationship with all of her clients. Her commitment, dedication and integrity were beyone reproach. She always represented herself as a professional and carining real estate agent. A majority of her business came from repeat clients and referrals from many of her very satisfied home owners. She won Top Agent honors every year I was there and continued her winning ways after I departed to work for another franchise. Cindy is, without a doubt, a, "Class Act". I recommend her to anyone looking for the very best in real estate representation.less Tony Romero
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