Private Mortgage

A private mortgage is one where the Seller of a property transfers title to the Purchaser and finances the purchase by taking back a promissory note secured with a mortgage on the property. When the Seller in such a transaction does not want the responsibility associated with being a 'lender', Ambassador Escrow can fulfill these obligations.

How We Can Help

Our private mortgage servicing is an affordable and professional alternative for: investors, individual sellers financing a property, friends and family looking for a third-party agent, or any Seller seeking a passive role in a Private Mortgage. We fulfill your obligations by:

  • Invoicing Monthly
  • Providing Accurate Records of All Payments
  • Escrowing for Taxes and Insurance
  • Providing IRS Form 1098 Reports to the Purchaser
  • Generating Notices of Non-Payment
  • Help Maintain an "arms length" relationship between Purchaser and Seller

Installment Option

Ambassador Escrow, the only commercial administrator that has the experience and expertise required to properly service Installment Option contracts. We have helped to facilitate thousands of option contracts and private mortgages throughout the country.

What is an Installment Option?

An Installment Option is a contract wherein payments are made in installments. Consider it a ''lease purchase'' wherein ''lease'' payments are replaced with interest payments. Just as with a Bond for Deed, a Memorandum of the contract is recorded in the public records to protect all parties.

The Installment Option contractually incorporates many of the positive features that are statutorily provided in a Bond for Deed contract in Detroit, protecting both Seller and Buyer. Therefore, the Installment Option is an instrument used in lieu of a Bond for Deed outside the State of Michigan.

Where We Come In

To protect all parties, a full title review and notarized documents are required. Escrow Service, Inc. a third party administrator, is appointed and becomes the owner's agent to handle property insurance, tax, and underlying mortgage issues. As with the Bond for Deed, we collect the payments, pay underlying mortgages, and issue IRS 1098 interest reports. In the event of nonpayment, the administrator sends the required notices.

When to Use an Installment Option

Owner Financing: Use an Installment Option whenever the owner will finance all or a portion of the sales price. Canceling an option for non-payment is much less costly than foreclosure.

Save Money: Use an Installment Option to save closing costs. When you buy or sell property under the Installment Option contract, you do not have to pay 'points', appraisal and survey fees, private mortgage insurance (PMI), or repairs required by the mortgage company before it will make a loan.

Mortgage Not Assumable: Use an Installment Option whenever an existing mortgage has restrictions against assumptions, land contracts, contracts for deed, Bond for Deed and transfer or beneficial interest under a land trust. The owner can 'wrap' existing mortgages within the terms of the Installment Option.

Purchaser/Property Doesn't Qualify: Use an Installment Option whenever the Purchaser or the property doesn't qualify for a loan. Many would-be Purchasers cannot qualify for a new mortgage... sometimes the property does not qualify... the reasons are endless. The terms of the Installment Option are strictly between the owner and the Purchaser.

Additional Information

Maintenance: The purchaser is responsible for repairs, maintenance, etc. after the closing of the Installment Option contract.

Insurance: Property insurance is issued in the owner's name with purchaser paying the premiums and named 'Additional Insured'.

Tax Deductible: The IRS treats an Installment Option the same as an installment sale for interest and depreciation purposes.

Bankruptcy: In the event the owner files a bankruptcy action, the purchaser is protected by the U.S. Bankruptcy Code, provided the Memorandum of the Installment Option is recorded in the public records.

Default: The Installment Option allows the owner to cancel the contract and take back the property if payments are not made within the time allowed and without thecostly expense of foreclosure.

Contact us to let our team of professionals use their expertise for you.

Services Resources
Bond for Deed
Private Mortagage &
Installment Option

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"The professional and personal level of service we received from Ambassador Escrow was unbelievable."
-James Dufrene

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Contact Ambassador Escrow 150 W. Jefferson Ave. Suite 4010 Detroit, MI. 48226.
Phone: 313-264-0750
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