MN HOMES CONTRACT FOR DEED

MN Owner Financing Glossary

Amortization: The payments on an amortized loan are established to contain both principal and interest so that the loan will be paid off in full by the end of the amortization period.

Balloon Payment: A large payment on a note, usually due at the end of the payment schedule. There can also be partial balloon payments during the note term.

Beneficiary: The person entitled to receive the payments on a note.

Carry Paper: For a property seller to take part or the entire price of the property in the form of a secured note. Example: the seller carried $15,0000 in paper to facilitate the sale of his property.

Closing Costs: The various fees and charges involved in closing a transaction.

Collateralized Loans: Property pledged as security for performance of an obligation, such as a loan, mortgage loan (such as mortgages and/or notes secured by trust deeds)

Double Escrow: Two separate but related escrows or closings, each contingent or dependent on the other.

First Loan: A Note, A Mortgage, A Deed of Trust – the first loan to be recorded asa lien against a specific property (first in time and seniority).

Matching: Slang for the act of referring a note to a purchaser.

Mortgage: A security instrument, which pledges a property to insure payment of a note. In case of default, it is foreclosed in the courts.

Mortgage Broker: A party who joins borrowers and lenders for loans, earning a placement fee. Also, an intermediary who buys and sells secured notes.

Mortgagee: The party who is the beneficiary of a mortgage. The seller of the property who receives the monthly payment and holds the mortgage contract as security.

Mortgagor: The owner or buyer of the real estate. Also the borrower making monthly payments to the mortgagee.

Non-Performing Note: Whenever a Borrower is late in making payments or fulfilling the obligations as set forth in the Deed of Trust and there is no means for the Borrower to ever correct the non-performance.

Note: A written document that states a promise to pay, as well as the payment terms, which includes the total amount due, interest rate, amount and dates when payments are due, where to send the payments and the length of time given to pay the full amount.

Note Holder: The person(s) currently in ownership and possession of a note and entitled to collect all its remaining payments. The holder might not be the original beneficiary. “Note holder” and “note seller” usually refer to the same person(s).

MN Owner Financing: When the seller of a property takes a note secured by the property as part of the payment.

Promissory Note: A legal written promise to pay a certain amount according to its terms and conditions and is backed by a security instrument that pledges the title or other interests in real property as collateral to assure payment. See also Secured Loan.

Secured Loan: A loan (note), which has specific collateral, pledged to secure its payment. In the event payment is not made, the collateral will be sold to provide funds to pay the note.

Seller Carry-Back Financing: When the seller of a property takes a note secured by the property as part of the payment. See also Owner Financing.

Trustor: The person who conveys property in trust. One who deeds his property to a trustee to be held as security until he has performed under the terms of a deed of trust.

Payor: The person who makes the monthly payments to fulfill the terms of a note. It is also the mortgagor with a mortgage contract or a trustor with a trust deed.

Under-Performing Notes: Whenever the Borrower is late to fulfill an obligation of the Note and Borrower will correct performance soon.

Wrap-Around Mortgage: A larger Mortgage that “wraps around” a smaller senior lien. The debtor pays to the holder of the “Wrap-Around” and the holder of the “Wrap” pays on the included senior lien.

Related links

mnlakeplace.com

 or 

Mnownerfinancedhomes.com

BOARDWALK PREMIER REALTY INC

Steve Vennemann (651-334-8312) BROKER

Company located in the Twin Cities Metro Area.

CONTRACT FOR DEEDS IN MINNESOTA AND WISCONSIN USUALLY GO OFF A 30 YEAR AMORTIZATION SCHEDULE TO KEEP YOUR PAYMENTS LOWER SIMILAR TO A MORTGAGE.