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can you use the security deposit monies to pay out the earnest monies or down payment back to the seller in owner carry financing?

I know you have to have an account for security deposits that have been paid to you by the tenants before you can sell a property. My question is if the owner will carry you and you don't plan on selling the property any time soon, can you pay him the earnest monies from the monies from the security account?
By phoenixwholesale1158 from AZ May 4th 2015
Reply

If you are an individual, then you are not required to have a trust account for your tenants security deposits.. As far as using security deposits monies to pay for earnest money on a purchase contract, I would say most definitely not.. you do not own the funds until you close on the transaction.. so how could you use funds that will transfer to you upon sale as an upfront earnest deposit for a purchase? Unless I'm misunderstanding your question, I cant see how this scenario would ever work.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com

May 4th 2015

Since it's a seller carry contract lending laws don't that we mortgage people have to adhere to don't apply. You can pretty much do what you want.

May 5th 2015

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