Delaware notes come from Wilmington row homes, Kent County farms and beach property in Sussex. We put yours in front of several buyers and show you how each price was worked out.
A small state has few local buyers, and that shapes the offers.
The same worksheet comes with every offer.
| Remaining balance | $129,400 |
|---|---|
| Payments left | 168 |
| Buyer’s target yield | 8.0% |
| Purchase price | $115,000 |
| Discount from balance | 11.1% |
| Our fee | shown on every offer |
| Sell the whole note | Sell 60 payments | Keep it | |
|---|---|---|---|
| Cash today | $115,000 | $56,200 | $0 |
| Payments still coming to you | None | 108 payments of $1,140 | 168 payments of $1,140 |
| Total you receive | $115,000 | $179,320 | $191,520 |
| What you give up | Every future payment | The next five years | A lump sum now |
Illustrative example. Totals add up the payments as scheduled; they assume the payer keeps paying and are not adjusted for the value of money over time.
The promissory noteThe mortgage or deed of trustA payment historyThe closing statement from the saleDelaware is small enough to describe county by county. In New Castle County the notes are mostly on houses: brick row homes in Wilmington, single-family homes around Newark, Bear and Middletown. In Kent County, around Dover, Smyrna and Harrington, farmland and homes on larger lots come into it. Sussex County has two faces. The coast, from Lewes and Rehoboth Beach down to Bethany and Fenwick Island, is second-home and rental country, while inland, around Georgetown, Seaford and Laurel, it is farms and poultry operations.
Sussex County in particular has manufactured home communities where the resident owns the home and rents the lot. If you financed the sale of a home like that, the note is backed by the home alone, which is titled more like a vehicle than like real estate. Fewer buyers take these, because a note on a mobile home without land depends on a lot lease the lender does not control. If the home and the land were sold together and the mortgage covers both, you hold an ordinary real estate note. Say which it is when you ask us for a price on your Delaware note, since the two go to different buyers.
The promissory note is the debt. A separate recorded document, the security instrument, gives the note holder a claim on the property. In Delaware that is generally a mortgage, filed with the county Recorder of Deeds.
When a payer defaults, a Delaware mortgage holder ordinarily forecloses through the courts, and the out-of-court sales used in deed of trust states are not the norm here. We stop there on the legal side: the steps, and how they apply to your mortgage, are for a Delaware attorney or a title company in the county to confirm.
Every buyer starts from the return they need on the money they pay you. The higher that return, the lower the price, which is why offers come in under the balance.
A court-based foreclosure state generally asks a buyer to allow for more time and cost after a default. Against that they set the things that make default unlikely: years of payments made on time, a payer with real money in the property, and a first-position mortgage that was properly recorded. With a beach property they also ask how it is used, because a home the payer lives in, a seasonal rental and a house that sits empty for much of the year carry different risks.
Some Delaware note holders sold a beach place and went home to Pennsylvania or Maryland, or retired and moved south. Living elsewhere is no barrier, since a note on a property in another state is priced by where the property sits, but it does mean the papers may be in a drawer you have not opened for years. If you also carry a note on a house back home, it goes by that state’s practice and is worth pricing separately.
Locate the note, the recorded mortgage and your payment history, and if the home stands in a community, the lot lease as well.
Generally by a mortgage, recorded with the Recorder of Deeds in the county where the property is located. Delaware has three counties: New Castle, Kent and Sussex.
Generally yes. A Delaware mortgage holder ordinarily goes through the courts to foreclose. The steps and timing are matters for a Delaware attorney, and a buyer will take the court process into account when pricing.
It may be possible, but it is a different kind of note. With no land behind it, the loan is secured by the home alone, and fewer buyers purchase those. Tell us whether the lot is owned or rented when you ask for a quote.
Yes. The property's location decides which rules apply, and the closing can be completed by mail. That holds whether you are in Pennsylvania, Maryland, New Jersey or further away.