Equity Deal Too Thin

Robert J. Bruss writes in “How to Get a Seller to Carry the Mortgage” (March 10) that the best candidates for carrying back a mortgage are the elderly who want retirement income. As an example, Bruss cites an offer to purchase a $100,000, free-and-clear property with $10,000 down secured by a first mortgage.

Bruss is suggesting a thin equity deal, with a cash down payment that is less than that required by conventional lenders. This may not be the safe and secure transaction he suggests, and may not be suited for the elderly.

A cash down of only 10% is not usually regarded as “safe” in the contemporary world of varying real estate values. Certainly the word should go out to elderly sellers that there may be risks not mentioned.

RICHARD M. CRANE

Woodland Hills

Crane is a real estate attorney.