Do I have to take the property subject to first, and then do a Purchase and sales agreement? The property that I’m dealing with is over mortgaged. I’m afraid if I don’t get the short sale , I do not want the property. Do I have to get the deed first? Then, if I get the deed and the short sale is not approved, am I liable when it goes through the foreclosure process. The guy that ownes the property wants to walk away from it. He financed it with an interest only loan with a 100% financing. :help
Well, lets correct your assumptions first. Getting the deed does not make you liable. The person who is on the loan docs is. What happens if the shortsale does not go through is that the bank ends up foreclosing and getting the house, but the foreclosure record will be on the person who guaranteed the loan not the person on the deed.
Now, do you need the deed? no not at all, but I will leave it to the more experienced to state why to get the deed first.
Thanks for answering my post! :smile
Actually, you get the deed from the owner. You just don’t record it until you are successful with your SS negotiations. If you’re unsuccessful with the SS, you can give the deed back to the owner or just tear it up.
The deed does not have to be recorded for the sale to take place, so tearing up the deed doesn’t invalidate the sale, although the evidence of the sale is no longer there and only thing left is the seller’s word against mr investor if it ever goes the legal route
Why should you get the deed again? If you take the dee and the property has back taxes who will be be responsible me right…? So again I guess dont record it is the only way around it…right…?
I guess the problem is actually fliping the property and method of funding…
Tell more please…
As soon as you’ve got the house conveyed to the land trust, you need to go to the courthouse and record the deed. This is important for a number of reasons. First, recording the deed in the name of the trust protects you from any new liens against the property. All the liens that were already there are still there, and you’ll have to get those negotiated off before you can sell the house, but no one can put a new lien on the house in the trust. Second it also protects you because you have this trust that ties you and the homeowner together. Third it keeps them from selling the property to another investor behind your back while your working the short sale. If & when you register your deed, you’re the one with the real claim on the house.
There are some people who will say you don’t want to record the deed because in case the deal goes bad and the house still forecloses, you don’t want to have your name on it. But that doesn’t hold much water because your name should never be on the deed in the first place, it’s in the land trust and you or your company is the beneficiary.
Now how do we arrange or setup this land trust?
Is the orig. owner a beneficiary of trust or trustee…?
Would I be 100% benificiary ? who would be trustee…?
My understanding is the orig owner would have to be a beneficiary somewhat in order to not trigger DOS clause…
How would this be setup to work…? what docs are necessary to do this…?
thanks
Mohegan
If your name is on the deed but not on the Deed of Trust, why would you care about the foreclosure? you did not guarantee the loan.