A refinancing technique involving the creation of a second mortgage which includes the balance due on any existing mortgages, plus the amount of the new secondary or junior lien.
the seller has an existing mortgage. The buyer arranges for seller financing. The amount of the seller financed loan covers the balance due on the existing mortgage, plus an additional amount to cover the balance due on the purchase price. The buyer makes mortgage payments to the seller. The seller continues to make the mortgage payments on the first mortgage and keeps the excess payment received from the buyer. The seller financed mortgage is called a Wrap Around Mortgage because it includes or wraps around the first mortgage.
a loan transaction in which the lender (usually the seller) retains responsibility for the existing mortgage
a mortgage in the amount equal to the difference between the total amount secured and the principal of the existing mortgage
a new mortgage which literally
A mortgage that includes the remaining balance on an existing first mortgage plus an additional amount requested by the mortgagor. Full payments on both mortgages are made to the "Wrap Around" mortgagee, who then forwards the payments on the first mortgage to the first mortgagee. These mortgages may not be allowed by the first mortgage holder, and if discovered, could be subject to a demand for full payment. Why Use a Mortgage Broker In the past 20 years, independent mortgage brokers have had a significant positive impact on the lending industry. Today the use of a professional mortgage broker is one of the key strategies used by sophisticated Borrowers.
A mortgage that is also known as an all inclusive trust deed that encompasses or wraps around other mortgages. Instrument usually used is a contract for deed.
A second mortgage, for an amount larger than the remaining balance on the existing first mortgage, usually payable to the debtor under the first mortgage who is also the seller of the property which secures the mortgage. The buyer makes payments to the seller, who is obligated under the law of the wrap around mortgage to make payments on the first mortgage. A wrap around mortgage may be used where the interest rate on the existing first mortgage is much lower than current interest rates available on new loans, for which the buyer may be unable or unwilling to qualify. "Also known as All-Inclusive Deed of Trust."