Buying a used home that still has a mortgage balance on it

Hello,

I found a home that I would like to buy but the seller still has a mortgage on the home. They need the proceeds of the sale to pay off the mortgage. How should I go about this sale and getting clean title in the safest manner?

@JCas06

Find a local escrow company that handles Mobile Home transactions. They will handle the payoff demand and title transfer. That’s the safest way to do it.

If you feel comfortable taking more risk, you can have the seller request a payoff. Send the lender that amount and give the seller the difference. Have the Seller sign over the home to you before you give them the money. The problem with doing it this way is you don’t have a clean title until the lender releases their lien. So you may be waiting around a few weeks/months without having a clean title. I would definitely do a holdback of at least $1,000.00 from the Seller to ensure they cooperate with any missing signatures etc.

Thank you. I am in talks with a local title and escrow company. Trying to get an estimate for what they would charge for this.

So to complicate this a little more I am buying the home for $2,500 less than what the payoff is. She agreed to pay off the difference. This seller has a loan with Triad. She said she contacted Triad and they told her once the loan is paid off which takes 7-10 days, Triad then contacts Sun Communities who is the original seller to let them know it has been paid off. Sun Communities then issues the seller the new title which she then has to sign over to me. This process can take 30-45 days.

What are my risks here? What would stop her from getting that nice clean title and not signing it over to me? I see you mentioned I could hold back some money but I believe she needs that money to pay off the loan. If I could hold back $1,000 or so what if she says hmm I could turn this title over for the remaining $1,000 or I could keep this title to a mobile home valued at $19,000.

How would the title and escrow company handle something like this? They must change some part of the process right?