Relay-Version: version B 2.10 5/3/83; site utzoo.UUCP
Posting-Version: version B 2.10.1 exptools 1/6/84; site ihuxr.UUCP
Path: utzoo!watmath!clyde!burl!ulysses!mhuxl!ihnp4!ihuxr!stanwyck
From: stanwyck@ihuxr.UUCP (Don Stanwyck)
Newsgroups: net.legal
Subject: Re: Mortgages
Message-ID: <1070@ihuxr.UUCP>
Date: Tue, 8-May-84 09:28:32 EDT
Article-I.D.: ihuxr.1070
Posted: Tue May  8 09:28:32 1984
Date-Received: Wed, 9-May-84 02:10:51 EDT
References: <649@ihuxb.UUCP>
Organization: AT&T Bell Labs, Naperville, IL
Lines: 28

The case you give is legal, as far as I know.  While I am not a lawyer,
I do deal quite a bit with real estate.  The practice described is 
actually quite common.

Another similar practice is the use of owner-financing of the difference.
Suppose that you agree that the house is worth $50,000.  Then, you make
an offer of $55,000, contingent on the owner financing some part of it
(frequently all of the difference between your first mortgage and the
sales price), preferably at a favorable interest rate.  This can get you
into a house without a down payment.  (the traditional amount to raise the
offer is to 110% of the agreed "real value" of the house)

Another technique (related) used by V.A. qualified buyers, when a home owner
is not willing to sell V.A. and pay the points, is to jack up the offer by
enough to cover the points.  This way the buyer is really paying the points,
but needn't put any cash out to do so.  And, for most owner-occupied houses,
V.A. will finance 100% of the sale price, leaving the buyer only responsible
for his/her share of the closing costs.

There are many more imaginitive, legal, even occasionally ethical, ways to
finance a house.  Consult your local realtor for the latest in your area.
-- 
 ________
 (      )					Don Stanwyck
@( o  o )@					312-979-3062
 (  ||  )					Cornet-367-3062
 ( \__/ )					ihnp4!ihuxr!stanwyck
 (______)					Bell Labs @ Naperville, IL