Twink, I think you were too nice.
Giving them the house for only $2,000.00 down. That is all they have invested in the house should they fail to pay their mortgage payments to you.
If you hold a mortgage on someone you really need to get a bigger down payment, but that is water under the bridge now. It also depends on the price of the home too. She does have until midight on the 7th to pay, without penalty, if you put that in her contract.
Any reason you didn't just try to sell the house, without holding the mortgage for the person/s ? Just sell it outright. Is it family or friends that live next to you now in your old house?
If not, and the interest rate you charge is large enough, maybe one of the new Fannie Mae or Freddie Mac loans will purchase the mortgage from you because it has so little as a down payment, no one else will. A bank CRA loan might buy it too. Maybe you just didn't want to get involved with all that now. If their credit is bad they got lucky with you holding the mortgage for them.
Btw, don't ever lend a ladder to anyone or a power tool. You are liable for it's use, even if a neighbor. If they fall or injure themselves, it's on your ladder. It makes no difference where they use it.
I would have your bank change the date of the automatic payment to a later date to be sure you have their funds cleared in the bank on time. Banks will do this for you and some mortgage companies too.
After 15 years of a medical career, I had to stop health wise, and for patient safety. I went into a combined brokerage/ banking, financial planning and real estate firm for the next 15 years.
Remember you get more with honey than lemons in conversations. But you have to be firm and not let the new homeowners have too much play. You should never be cussed out by anyone.
I wish you good luck with the neighbors. Maybe I have it wrong, I don't know the situation, in person. JMO anyway.
I had a family who rented one of my two homes, who paid on time, but trashed the place on the way out and never fixed up while living there. That house was only two years old. They had references too, fake ones. You never know what is the best situation.
I hope you don't have any more problems with these people. Good luck.
