hello investors, LAND TRUST QUESTION, WHOLESALING, CALIFORNIA
I am assigning a deal here in LA, REO DEAL. I am the “trustee of the property trust name” in the contract.
I have a buyer-investor who will I assign this deal (wholesale). this buyer is using hardmoney loan to buy this deal.
problem is that REO’s escrow and title company want me to be included in the deed of trust and or loan documents from the hardmoney lender for my investor. I dont want to be in the hook, he is the borrower. (escrow and title chosen by reo bank, not relationship with them)
But escrow and title says… “Oh now, you are in the contract, we have to match your name with these docs, otherwise title wont insure this deal and THE ASSET MANAGER and listing agent needs to know that there is other buyer (buyer-investor) in this deal, we need to get authorization from reo asset manager” any thoughts or why they do this?
They say, to add my partner (investor) to contract, but, I will be in the same boat cause even if they added this investor, they want me and this investor to be the the deed of trust documents, yes, both together, they have to match the name.
Any ideas, help here???.. I thought will be simple, yes, if Cash investor it is, but hardmoney loan investor, it is hard.
I am not sure where to start, there are so many different protacal's here that place demands on the transaction!
Most all lenders will let “You” buy the property in the name of your Trust provided you are paying cash to close and do not have a mortgage lender, you will have to submit your trust documents or a choice of the “Memorandum of Trust” or the “Verified Certificate of Trust” depending on the type of trust.
So that you know, a lot of lenders require an REO (Real Estate Owned) property that was taken back from a borrower as a foreclosure, to be closed to the contracting party as some states laws prohibit a change of ownership during escrow! Now you could presumable have done a transactional funding; closed to you, then closed to your buyer!
Because there is financing involved the newest federal lending laws require a closing to the contracted party, there again a transactional funding company, close escrow to you with a hud 1, then close to your buyer the next morning with a hud 1!
Now, California is a state that prohibits simutanious closings using your buyer’s funds, so you can not close that way unless you have enough cash to close to your self, then close to your buyer.
And they are not going to let you close in your trust’s name as your buyer is not party already to that trust!
I think you have some problems, the contract in your trust name, a buyer but no way to close to you to then close to your buyer without using transactional funding!
Even a cash buyer does not solve it as you have to have your own cash, down payment and lender or transactional funding to close to you to sell the property to an all cash buyer.