FAQs
Q. Is ESI licensed and bonded?
A. Yes, ESI is licensed by the Louisiana OFI, the same regulatory body that regulated banks and savings & loans. EIS is fully bonded and meets all regulatory bonding requirements.
Q. In which state does ESI operate?
A. ESI services private mortgages in all 50 states.
ESI services Bond for Deed contracts only in Louisiana.
ESI will service installment option contracts in some states, but not all. Please inquire for more information.
Q. Can I offer seller financing alternatives if there is a mortgage on my property?
A. Yes, please inquire for more information on your specific circumstances.
Q. Is a Bond for Deed the same as a lease-purchase?
A. No. There are numerous advantages to both Purchaser and Seller in a Bond for Deed versus a lease-purchase including:
- lease payments are not tax deductible; interest paid on a Bond for Deed is tax deductible
- equity appreciation for the Purchaser
- elimination of costs and headaches of being a landlord for the Seller, such as payment of taxes and insurance, maintenance and upkeep
- significantly improved ability for Purchaser to qualify for a conventional mortgage to acquire title and pay Seller in full
- investment by Purchaser in the form of a cash down payment versus a rental deposit
- ensuring clear title at time of title transfer
Q. Will ESI collect, hold and pay taxes and insurance out of escrow?
A. Yes, if requested to do so.
Q. Does a Bond for Deed qualify for a Homestead Exemption in Louisiana?
A. As a general rule, no. Please inquire for more information.
Q. What is the difference between a Bond for Deed and an Installment Option?
A. A Bond for Deed is a contract utilized strictly within the state of Louisiana that is governed by the Louisiana Bond for Deed statutes. An Installment Option is a contract generally used outside of the state of Louisiana, contractually containing provisions that are provided for statutorily in the Bond for Deed contract.
Q. Why use an escrow agent?
Under a Bond for Deed:
- If there is a mortgage on the property ñ it's the law!
- As a seller, youíre required to keep a full accounting of all payments, be able to quote accurate payoffs to lenders, and report 1098 interest to the IRS.
- When a buyer refinances, mortgage underwriters want to see payment to an independent third party (not the Seller) as evidence of timely payment.
Under a private mortgage:
- Maintain proper accounting of all transactions
- Provide required IRS reporting
Q. How are taxes and insurance handled?
A. In private mortgages, Bond for Deeds, and Installment Option contracts, taxes and insurance are typically the responsibility of the Purchaser.
In a private mortgage, Purchaser should obtain their own insurance and name Seller as additional insured.
In a Bond for Deed or Installment Option there are varying insurance options. Please inquire for information specific to your circumstances.
Q. How do I find out more about the specifics of seller financing as it applies to me (Purchaser or Seller)?
A. Contact Escrow Services, Inc. at 800-654-7870 or service@escroservinc.com to discuss your specific circumstances.