First let me say thanks to everyone for the great posts. I have learned a great deal over the past few weeks…
I am just starting out and have what hopefully will be a great lead source of pre-foreclosure deals. I am however a bit nervous and confused about a few things.
If I get a seller to agree to a “Subject To:” or “Option Purchase”, how long do you normally give them to move out of the home so you can start showing it???
Legally what is the difference between “Subject To:” and “Option Purchase”? My take is this…On a S2 you are being put on the Deed of Trust and taking over the payments which means you must have a closing with a title company??? On an OP you are simply signing an “Agreement” to purchase it at some predetermined date in the future and taking over the payments. Is this correct or am I completely off base here? Also which one is preferrable?
If doing “Subject To:” is it better to put the deals into a Land Trust? FYI…My state is a Deed of Trust state. If so where can I find good information on how to setup a Land Trust?
Do you get tax benefits on an Option Purchase or does the seller still retain this?
How do you handle a situation in which you have signed up a seller either via Subject To or Purchase Option and then you cannot find a buyer within the originally agreed upon timeframe? Can you put in a clause that will allow you to return it back to the seller and if so can they cause legal issues for you in this situation?
This goes along with #5… I have no real money to start out with so I am looking to flip these properties to retail buyers or other investors. Most of these homes will already have the Trustee Sale notice filed so there will be very limited time to close the deal. Can you get an extension on the sale if you can show that you are in the process of purchasing? Or better yet, what is a good exit strategy if you can’t meet the deadline?
Thanks so much for your help…