How to do a L/O or Sub2 in Texas the right way

General Real Estate Investing
1

I’ve been reading that Texas has some laws that make it more difficult to do L/O and Sub2. Which one is the easiest to do in Texas from the investor’s point of view? What do I need to know to cover my butt when sandwiching L/Os here? Anything else I need to consider?

Thanks!

2

I specifically do LO’s in TX, but since you have to have fee simple title to be the seller, you can’t really do a sandwich LO.
I do assignments only.

3

Thanks for the response pilot. Wow, so I can only do assignments? So everything about getting a option deposit, cash flowing a little each month, then having a big $20-30k pay day at the end just doesn’t work in Texas? :shocked

Dang - L/Os and Sub2 seemed like such good ways to start RE investing. Assignments are similar to flipping to retail buyer, yes? Like putting 2 pieces of a puzzle together and you just get a fee for doing it?

4

I’m sure there are people that do SLO’s here, but per the law, the seller has to have fee simple title, and if you do a SLO, then you are the seller to the end buyer.
Yes, with assignments, you assign the lease option to the end buyer and are paid the assignment fee. (typically 3% or so)

5

Ok, thank you for the clarification