Finance
In Nevada, what is a 'seller carryback' or 'purchase money mortgage' and when is it commonly used?
AA loan where the buyer borrows from a Nevada bank with the seller as co-signer
BOwner financing where the seller acts as the lender, accepting a promissory note secured by a deed of trust instead of full cash payment✓ Correct
CA government subsidy program for Nevada first-time buyers
DA mortgage that automatically converts to a grant after 5 years of payments
Explanation
A seller carryback (purchase money mortgage/deed of trust) is owner financing where the seller acts as the lender, accepting a promissory note and deed of trust instead of full cash at closing. This allows buyers who cannot qualify for conventional financing to purchase the property.
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Key Terms to Know
Deed of Trust
A security instrument used in many states instead of a mortgage, involving three parties: borrower (trustor), lender (beneficiary), and a neutral trustee.
Promissory NoteA written promise to repay a loan under specified terms — the borrower's personal financial obligation in a real estate transaction.
DeedA written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
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