Posted by Tom – IN on July 30, 2001 at 07:33:36:
This is a commonly used method. I’ve never done it, but I like it.
protecting your investment with L/O’s - Posted by wayne
Posted by wayne on July 30, 2001 at 01:22:05:
Quick question about l/o
Lease options are a nice alternative to subject to’s. As long as they are not recorded then the existing financing can stay in place.
My question is this:
Even if the payments are current or if the home is in arrears, I believe it is extremely important to protect your interests in the property. One thing you do not want to do is alert the bank about a lease option, even if they dont care, there is absolutely no reason for them to have any chance to have the option to exercise their option for the dos. So if the seller doesnt send in the payment that you give him, then the bank can later foreclose on the home and it really doesnt matter, your screwed, the only recourse you have is to sue the seller which at this point doesnt mean squat as far as I’m concerned since you have a t/b in there already. so you have to come up with cash now to close the deal.
Sorry this is kinda long but I believe it is important:
Why not just make the payments directly to the lender on the property for them, and then the amount that the seller would make on his monthly profit if any, you send in a check to him. to not raise eyebrows with the bank you simply send them a cashiers check. This way your interests are protected.
Has anyone ever done their l/o’s this way or am I missing something here.