i have a rv i still have loan on and will be selling to privet party. but i will have to carry the contract what is my best thing to do on this
2 Answers from Attorneys
Re: rv sales
Much depends on how the contract for your present loan reads. If the buyer can assume that loan, that is probably the best idea. If the loan cannot be assumed, you will have to check and see what happens if you sell the RV before the loan is paid. Without seeing the loan papers, I cannot say, but I am guessing there would be consequences.
If the buyer can assume the loan, then you would just need to arrange a promissory note for the additional amount that the buyer would owe you over and above the amount due on the original loan.
If the buyer cannot assume the loan, you can carry a promissory note for the full amount, but you will need to make sure you can handle whatever consequences are called for in your original loan. It is possible that you may have to pay it off immediately in full.
Either way, you should make sure the promissory note is secured by the RV, meaning you have a legal right, after certain procedures are followed, to have the RV sold and your debt paid off, if the buyer does not make the payments.
An attorney can help you to understand your rights, choices and liabilities under your current loan, and can help you with the details of the paperwork that I've mentioned above.
Re: rv sales
There are lots of ways to go about this, and a lot will depend on what your current promissory note (rv loan) says you can do. As a starting point, let me say, DO NOT DO THIS!
I say don't do this, because I see so much more downside than upside, no matter who you are selling to, no matter how good their character. The bottom line is, their finances are already somewhat shaky if they can't afford to finance the RV on their own, so that makes them generally very un-creditworthy.
Think about the home loan mess the nation is in right now because people who could not afford loans got them anyway, and big surprise, they got to a point where they could not afford to pay them any longer. In your case, what happens if the buyer can't afford to make your payments? Either your credit suffers and the bank comes after you, or you pay their loan so they can live a lifestyle much richer than they can afford.
I've seen this exact situation before, when clients have come to me after the situation went to He## in a handbasket, and trust me, it's not worth it.
If you need to sell, and you can do so at least at a break even price to someone who will get their own loan, always do that before you sell to someone who would supposedly give you some amount of profit because you'll likely never see the profit! Your credit is worth too much to risk it on someone who professional lenders would not take a chance on.
If you elect to ignore my advice about avoiding this deal, then at least spend the money to have an attorney properly draw up the promissory note between you and the buyer, and make sure to have it secured by more than just the RV. Get real estate as well, if you can. I say this because by the time you seek to take the RV back when they default, you'll likely find it to be in pitiful condition and hardly worth a fraction of what YOU still owe your bank on it.
I hope this helps!
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