Was wondering if anyone has any experience with this subject. I have a property that I may be able to pick up on a shortsale and the homeowner would like to do a lease purchase after the shortsale is complete. I was wondering if there was any legal issues i might run into now or later down the road when they decide to exercise their option to purchase.
I would appreciate any input everyone has to offer (by the way i am in CA if it matters). thanks.
Let’s see - you’re going to pick up a property on a shortsale and lease-option it back to the deadbeat that wouldn’t pay his mortgage to the bank in hopes of making some money on the transaction…?
Let me know how that’s gonna work out for ya!
Personally, I see no good coming from this. Just my two cents though.
Keith
hey thanks for your kind reply!!! you know these forums are so people (especially newbs to the investing world) can come and learn from more experienced people, and your a moderator??? maybe you should learn how to interact with people in a lil nicer way. Yes you are right, and i thank you for pointing out the obvious. sometimes the simplest things are over looked.
Just my two cents though.
I’m not an attorney, so don’t take this as legal advice. But I don’t think there is anything illegal in doing what you described.
However, from a practical standpoint, I would urge against it. Like the previous reply stated, if the homeowners were unable to make their payments to the lender, think how difficult it will be for you to collect. If you’re going to do the deal, they have to go.
well from what i am seeing here in CA is that a lot of people are getting discouraged from the home prices dropping and people are more willing to just walk away from there homes. It would be completely different if they had $100K in equity but almost nobody does these days. The common mindset is ‘why should i pay this much if my house isn’t worth it anymore’. I am just trying to figure out a good way to help these people out. If there is a better way, let me know please.
Yup, I’m a Moderator and that has ABSOLUTELY ZERO to do with anything. If I was answering you as a Moderator, it would have said “Moderator” on the line under my name. I am also a Member of this Forum and, as such, I am allowed to have opinions about the topics herein. You asked for opinions and you got mine. Stop whining and sniveling - it’s unbecoming.
Life Rule #8 (http://www.reiclub.com/forums/index.php/topic,25929.0.html) - “If you can’t stand the answer, don’t ask the question”.
This topic (and its corollary question, “What do you think about me buying a prefoclosure and renting it back to the previous owner/deadbeat who wants to stay there”) have been asked dozens of times. It’s a BAD idea. If the guy (e.g., “the deadbeat”) doesn’t/can’t/won’t pay the lender, why would you think that he (deadbeat) would pay you enough rent for you to cover YOUR mortage AND expenses and still make some money??? Answer: Pretty clear cut in my mind (and , yes, very obvious) - he (deadbeat) can’t/won’t.
Now, go back to the People’s Republic of California law and see how much money and time it will take you to get him (the deadbeat) out of your property while he (the deadbeat) is not paying rent and living on your dime.
…and if you think I’m not nice, you should have met me when I was short-tempered, too!
Just my two cents - I still have mine but you won’t soon – “deadbeat” will have those, too!
Keith
Keith is right. Another consideration: if you lease/purchase to the same owner who defaulted and your purchase price is lower than the original defaulted mortgage you may have legal issues. Just an opinion not legal advice.
I’d rather someone like kdhastedt be blunt and tell me just how it is than tip toe around my trying to protect my feelings.