Here are some common questions that our sellers have asked:
Exactly What Is A Land Contract?
How Much Can You Pay Me For My House?
How Does R. F. Miller Properties Profit?
Are There Any Drawbacks To A Land Contract?
What Happens If The Buyer Moves Out?
What If I Want To Buy Another House Before R. F. Miller Properties Can Refinance?
How Do I Know R. F. Miller Properties Will Make My Mortgage Payments On Time?
My House Is Listed With A Real Estate Agent. Can Your Program Still Work?
You Say No Fees Or Commissions, But Are There Any Other Costs?
What about liability?
Do You Have References/Testimonials?
I Am Interested In Seeing An Offer, What Is The Next Step?
Exactly What is a Land Contract? A Land Contract is simply an installment sale of real estate. Instead of buying property with cash or with a bank mortgage, the buyer makes monthly payments, with interest, on the purchase price. Payments are applied just like a bank loan with a large amount of each payment going to interest initially, while a very small amount pays down the balance. This means the debt pays down very slowly during the first several years, which is very good for you, the seller! Back to top
How Much Can You Pay Me For My House? If your home qualifies (and most homes do), we can pay top dollar for your house. We don't make insulting low-ball offers and we structure our payments to you so that they cover your monthly payments. We can do this because a sale like this provides us with an opportunity to eventually make a profit by selling it for a little more, with slightly higher payments. Back to top
How Does R. F. Miller Properties Profit? We are able to make our profit because our buyers are willing to pay us to find homes like yours for them to live in. Our profit comes from our buyers, NOT FROM YOUR POCKET!
Since we can offer our buyers an opportunity to refinance the house after they've had time to improve their credit, as opposed to forcing them to find new financing today, the house will have a little more market value than what it might appraise for this afternoon. Also, it's considerably easier to qualify to refinance than to get a mortgage on a new property. Because we can offer our buyers these benefits, we are able to sell for a little more than market value. Back to top
Are There Any Drawbacks to a Land Contract? Perhaps the only downside to a Land Contract is the length. Terms of ten to thirty years are not unusual and in fact, pretty common. Typically we need to arrange for a term of at least seven years. The good news, though, is that our buyer are usually able to apply for a refinance after their Land Contract has only been "seasoned" for 12-24 months. Because of this, it's common for our buyers to refinance the home within just 2-3 years! Back to top
What Happens If The Buyer Moves Out? Sometimes when we find someone who buys the house, for one reason or another, they are not able to refinance the property and they give the house back to us. Reasons usually include a transfer out of the area, a new baby or other life-changing events. When this happens, we make updates the home may need and we find another buyer. Because we guarantee that we will cash you out, we need at least 7 years, not just 24-36 months, in case our first buyer does not refinance. The extra time insures that we will be able to find another buyer who will be able to refinance and cash you out. Back to top
That Is All Good, But What If I Want To Buy Another House Before You Can Refinance? That is another beautiful feature of a Land Contract. If you have the ability to otherwise qualify for a new mortgage loan on another house, the fact that this current loan has not been paid off won't be a problem. Since a Land Contract is considered an installment sale by the IRS definition, most lenders have no problem giving you 100% credit of the monthly payments we are making toward the outstanding debt. In other words, if your payment is $1,000 per month, and we are paying you $1,000 per month, your new lender should consider the debt to be fully covered, however we recommend you check with your new lender to make sure.
You may have thought of renting, but did you know that if you were to rent the same house for say $1,100 per month ($100 above your payment), your new bank will only give you credit for 75%-80% of the rent payment you are receiving, because as a landlord, the bank is assuming that you will have vacancy and repair responsibilities. That means that they will only apply about $825 of the $1,100 rent payment toward your $1,000 monthly debt, and then will add the $175 monthly deficiency to your debt ratio. This may prevent some people from qualifying. Back to top
How Do I Know R. F. Miller Properties Will Make My Mortgage Payments On Time? We will make the mortgage payments directly to your mortgage company. However, since your name will still be on the mortgage and the deed, you'll be notified right away if the payment is late. Our company does not make money unless we sell the property and we can't sell the property if we don't make timely payments. We will also be happy to provide you with references from people we have done business with in the past. Back to top
My House Is Listed With A Real Estate Agent. Can Your Program Still Work? Yes! If your house is listed, you have two options. First, you should leave it on the market until it expires and give us a call then. Who knows, maybe your agent will bring you a buyer. If you can not afford to wait until then and would like to sell your home immediately, we CAN work with your agent. Call us because many times we can work something out with your agent to make sure their commission is covered. Back to top
You Say No Fees Or Commissions, But Are There Any Other Costs? Because our buyers pay us to find homes for them, we do not charge you any commissions whatsoever for our services. In fact, by selling your home to us, you will avoid many closing costs that you would typically encounter in a conventional sale. It is not unusual to pay upwards of $2,000- $3,000 in various closing costs and that is NOT including any commissions you might typically pay an agent! When we buy your home, the only costs to you are your prorated taxes and the title work and title insurance. Title work typically costs only $350 and title insurance is based upon the sale price of the house. We can do all the other paperwork for you at no cost. We can also build most of the unavoidable costs into our purchase price so you won't have to bring a large sum of money to closing in order to sell to us! Back to top
What About Liability? Some of our clients are concerned about remaining on the deed for liability reasons. If someone were to slip and fall on the property and your name is still on the deed, you will still be named in the lawsuit even though you have already sold the home. R. F. Miller Properties CAN take the deed out of your name and keep you from being liable for events occurring on the property. Ask us for more information about this option. Back to top
Do You Have References/Testimonials? Yes! Click here to hear what people are saying.
I am interested in seeing an offer, what is the next step? First, you will need to contact us in order to provide us with some information about your house. Next, we will come out and take a look at your house and the neighborhood. After that, we can have a written offer for you within 24-48 hours. This is a no obligation service, and there is no pressure to sign anything until you are ready. Back to top
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