A wraparound mortgage is a form of creative financing where the seller keeps their existing loan in place and wraps a new loan around it. 1st Option Title handles the complex title and escrow work these transactions require.
The seller has an existing mortgage on the property. Instead of paying it off, the seller creates a new, larger note (the wrap) that includes the existing loan balance plus additional amounts owed by the buyer. The seller uses the buyer's payments to pay the underlying mortgage.
Wraparound mortgages create layered lien positions that must be carefully documented. The title company must understand the relationship between the existing loan, the wrap note, and the deed of trust securing it. Proper recording and lien priority are critical.
Contact 1st Option Title to discuss your transaction.