What if the owner of the House for a Lease Option get’s some type of lean or law suit on the property. while Im leasing it for two years what happends. :rolleyes
You may want to consult an Attorney. If you did a memorandum of Option or better yet a Performance Mortgage then you’ll be better off. Herbster
Your option to purchase will be subordinate to the creditor’s lien. Worse case is a sheriff’s sale to satisfy the judgment.
“You may be able to deed into trust and have the trust held by an agreeable third party as step one…step two would be to gat an LOA for the lender so you can get the real deal on the loan and step three is to go to a local title company and pay roughly $200.00 for a “nothing further” title search on that there property so you see what’s all on it…”
Here’s a couple of ways to handle this problem, but of course it depends on how much the lien or law suit is and how cooperative the owner is. If the amount is less than the owner would get when you purchase the property the lien or suit satisfaction could come from the proceeds.
If the amount is relatively small and you can afford it you could pay it and add on to your option fee amount. Before you do anything consult an attorney as laws differ from state to state.
Either way have an attorney draw up an amendment to the option agreement so there won’t be any question about what happened. Record the satisfactions with your name again consult an attorney and be sure you let the owner know he will pay the attorney fees.
Expanding on what Herbster said:
Once you have an option you will want to record a memorandum of it on the public record. This positions your interest in time and may be enough to protect your interest.
You can try to sue the seller for damages, but if they can’t keep up with the payments, then you may be SOL trying to collect.