Posted by dewCO on December 15, 2000 at 09:05:25:
Just make your concern part of the deal/negotiation going in. Either agree that you can wait X mos., or until the place has a tenant, or, that the seller makes x number of payments until you get a tenant. Shouldn’t need a performance mortgage to cover this concern.
Performance Mtg Legal question… - Posted by vladimir_Chicago
Posted by vladimir_Chicago on December 15, 2000 at 06:54:55:
I was wondering whether I, as a buyer, could have the seller sign a performance mortgage whereby seller would be OBLIGATED to take title to his property back in case I miss a payment in 60 days.
The reason I would want to create such a performance mortgage is bad neighborhood-- I do not feel easy owning a house in a less than desirable neighborhood. I do not mind helping the seller out until I have suitable tennant/buyer, however, I do not want to get stuck as an owner of the property in case it turns out to be a tough job getting tennant/buyer.
Any suggestions or past experiences?
Thanks,
Vladimir_Chicago
Re: Performance Mtg Legal question… - Posted by JPiper
Posted by JPiper on December 15, 2000 at 09:57:36:
To answer your question, you could simply not take title. Instead, enter into a contract that is subject to locating an acceptable tenant/buyer. You can?t make a mortgagee take title back. I?ve noticed a few times here on the newsgroup that some people recommend taking the deed, but not recording. Later if they decide they don?t want the property they tear the deed up. I don?t like that idea. In my opinion, title has passed when the deed is delivered and accepted, not when it is recorded. But if you decide to do this latter approach, speak with a local real estate attorney first to see how the law works in your state.
Actually though, regardless of what you do regarding the above, I don?t think you?ve solved your problem. Let?s say you find the tenant/buyer, now the tenant/buyer defaults, and you?re back to finding ANOTHER tenant/buyer, still worrying about the neighborhood. Now what?
I?ve never known the definition of a ?bad neighborhood?. Obviously, the word ?bad? is subjective. City neighborhoods as an example might easily look ?bad? to someone who is coming in from a homogenous suburban community. Someone driving past a couple of hookers standing on a street corner might be quite concerned. And yet I know of some very upscale neighborhoods in such areas. I used to joke that my definition of a warzone was when I had to ?belly-crawl? up to the front door.
But clearly, you need to be comfortable with the area. I don?t think that means that it has to be an area that you would live in. But then again, you will probably have to be in the area, and therefore what you?re comfortable with becomes important. I would say that you need to make that decision now before you get involved.
JPiper