pure option help needed Thank you!

General Real Estate Investing
1

Hi,

A quick question: Is title search needed for pure option deal? Do I need to worry about if the seller can’t close the deal because of liens on the property?

Thank you for your help!

Anthony

2

Howdy Anthony:

If it is a free option then I would not care about a title search. If the option cost serious money I would want a search done especially if the seller gets the option money. Standard EM contracts have option periods and I usually will put like $20 for the option in a residential contract for the option period without having the title search complete.

3

Thanks Ted. But if I am to market this property, such as putting ads in the newspaper, should I first make sure that the title is good? And could you clearify what EM stands for?

Thank you for your help!

Anthony

4

Howdy Anthony:

Earnest money

It is your call. Odds are there is no problem with the title, unless the seller is aware of something. Has there been a divorce or death of one of the owners are all good questions to ask before spending money. Ask the seller if he has been sued or have the taxes been paid. Hard to set a week and not market it while waiting on the title report. Time is money too. Your buyer will also make his EM contract subject to the title report

5

Thanks Ted.