What to know

  • Updated: March 17, 2012 - 2:38 PM

•Be sure that the interest rate does not exceed the maximum allowed by law.

•Have the property inspected.

•Close the deal through a title company.

•You are not protected by Minnesota foreclosure laws, so if you are in default, the seller can reclaim the property without a foreclosure sale or judicial action. 

•Most contracts have a balloon payment at the end. If you can't pay it, the seller can cancel the contract with just 60 days' notice. The seller gets the property back and can keep your down payment and equity.

•Remember, the seller can still mortgage the property. Protect yourself by recording the contract with the county recorder after the contract is signed by both parties.

•You can download the entire guidebook by going to www.gmhf.com.

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