I have a person who wants to lease option my house. He has $2000.00 for option. When we draw up the rental contract and it asks for a deposit can I enter “0” for the deposit and show the $2000.00 on the option part of contract?
Another question: This person was convicted of trafficing back in 1991. He seems to be clean now. If by chance he begins to deal drugs in my home and is caught can I loose my home?
Thanks,
Todd
Howdy Todd:
You will need to keep an eye on the property. In Texas if your property is targeted by DEA agents or even police as a drug property you could be forced to board it up for a year or pay a $10K cash bond for a year. I did the $10K cash bond on a 5 plex and it was not easy. They can also have the property demolished if the violations persist.
Put the property in a NARS land trust and protect yourself. If he acts out, he can be easily evicted and you don’t have to worry about foreclosure. In addition, the trust protects you from creditors, marital disputes, judgments, etc. I woud NEVER enter such a transaction without proper asset management strategy. Good luck.
Hi Todd,
Yes, put “0” in the deposit area.
If im an investor I do not want to deal with deposits. Running around giving the deposits back. Option money is non refundable!! You take that to the bank!
If you are the seller and want a deposit to cover any repairs or damages when they leave, then go ahead.
but I dont deal with deposits.
Can you loose your home if he is caught dealing with drugs in your home?
it depends on the state your in. check with an attorney in RE. That was back then in 1991. Does he haves a good paying job, is he a good boy? Run a credit check and check references. Do a criminal check also, make sure he has been behaving after '91 and go by your instints.
To your success,
Diana
Diana, Ted and Gary, Thanks for your replies.
Todd