Our wrap‑around mortgage servicing bridges existing financing with seller-carried loans. We collect buyer payments, make timely mortgage payments to the original lender, and manage escrow accounts. We issue monthly statements, provide IRS interest reporting, and deliver formal default notices if necessary.
With third-party tracking and transparency, both sellers and buyers receive documented assurance. Our systematic oversight protects seller obligations and buyer contributions, making complicated financing straightforward and thoroughly managed throughout the term.
Our team manages wrap‑around mortgages with precision, handling payments, escrow fund management, statement delivery, IRS reporting, and compliance support for both sellers and buyers.
ACH systems ensure accurate payment remittance to lender and seller.
We manage tax, insurance, and HOA contributions securely in escrow.
Buyers and sellers receive consistent monthly statements and tax forms.
We issue compliance-driven default or late payment notices swiftly and clearly.
A Wrap-Around Mortgage is a form of owner financing where the seller carries a promissory note for the buyer that “wraps” around an existing underlying mortgage. The buyer makes one payment to Escrow Services Inc., and we ensure the underlying mortgage is paid first, with the remaining equity disbursed to the seller.
Yes, they are legal and commonly used in Louisiana real estate. However, they require precise documentation to ensure the buyer’s interest is protected and the seller’s original lender is satisfied. As a neutral third-party administrator since 1985, we ensure these contracts are handled with the professional oversight required by state standards.
The “Due on Sale” clause is a common concern in wrap-around deals. While we do not provide legal advice, our professional servicing provides a clear audit trail and ensures that the underlying mortgage stays current. By acting as the payment intermediary, we provide a level of transparency that helps mitigate the risks often associated with un-serviced wraps.
In a wrap, the buyer is trusting the seller to pay the original bank. If the seller fails to do so, the property could face foreclosure despite the buyer being current. Escrow Services Inc. eliminates this risk by receiving the buyer’s payment and paying the underlying lender directly. This ensures the primary lien is always protected.
Typically, the “wrap” loan has a higher interest rate than the underlying mortgage. We manage the complex math involved, calculating the interest for both loans, tracking the principal reduction for each, and providing accurate year-end tax reporting (1098/1099) for both the buyer and the seller.
It is possible, but highly complex. Any additional liens must be accounted for in the wrap structure. Our Mandeville-based team specializes in these multi-layered payment distributions, ensuring that every “slice” of the payment goes to the correct lienholder in the correct order of priority.
Yes. To protect the collateral, we can set up an impound account. We collect the 1/12th monthly portion for taxes and insurance from the buyer and ensure those bills are paid, or we verify that the underlying lender’s escrow account remains fully funded.
Once the underlying mortgage is satisfied, the “wrap” becomes a standard first mortgage. Our servicing remains seamless; we simply stop disbursing to the underlying bank and begin sending the full principal and interest portion directly to the seller (the note holder).
We always recommend that a mortgage or a Memorandum of Agreement be recorded in the local Louisiana Parish Clerk of Court’s office. This provides public notice of the buyer’s equitable interest in the property, a step we facilitate during our account setup process.
Sellers can often sell their property faster and at a higher price by offering financing. Additionally, sellers can “earn the spread” between the lower interest rate on their original mortgage and the higher rate they charge the buyer, creating a consistent stream of passive income.
To begin, we require a copy of the recorded Wrap-Around Mortgage, the Promissory Note, and the most recent statement from the underlying mortgage lender. Our team will verify the balances and set up the automated payment “waterfall” immediately.
Yes. While our headquarters is in Mandeville, we provide professional wrap-around servicing for properties in New Orleans, Metairie, Kenner, and all 64 parishes across Louisiana.
