Two Parcels, One Mortgage...can one parcel be separated?

**Craig Artzner** · 04-27-2009, 05:55 PM

Hello, I live in Ohio and we're talking to a seller who has two parcels of land under one mortgage. One parcel has their house on it, the other is vacant. We want to buy the vacant lot from them and they seem like they are willing to sell it to us if they are able to.

The seller says she must speak to her bank before she can work something out with us. She said there may be something in the mortgage agreement that may prevent them from selling the vacant parcel.

What could she be talking about? What would stand in our way here?

**Greg** · 04-28-2009, 04:57 AM

The mortgage is on both parcels, so the lender is not going to agree to the deal. The lender is using both parcels as collateral. To make it work she will have to refinance the property using only the parcel she will keep as collateral.

If she can not afford to do this, it might be possible to have simultaneous closings on both parcels so she could use your money to refinance her parcel.

**jamesww** · 04-28-2009, 07:17 AM

Originally Posted by Greg

The mortgage is on both parcels, so the lender is not going to agree to the deal. The lender is using both parcels as collateral. To make it work she will have to refinance the property using only the parcel she will keep as collateral.

If she can not afford to do this, it might be possible to have simultaneous closings on both parcels so she could use your money to refinance her parcel.

In addition to what Greg has seen here she may also be able to get the bank to release the lot as collateral if all proceeds from the sale are applied to the existing note and the remaining balance is no more than 80% of the appraised value of the parcel carring the house.

**Craig Artzner** · 04-29-2009, 06:21 PM

Originally Posted by jamesww

In addition to what Greg has seen here she may also be able to get the bank to release the lot as collateral if all proceeds from the sale are applied to the existing note and the remaining balance is no more than 80% of the appraised value of the parcel carring the house.

This is what I was thinking, we'll find out for sure tomorrow...