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psydoc
retired psychologist/real estate developer/builder
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How to protect a lease-purchase buyer?
Saturday, January 07 2012 06:41 PM
Hi Randy,
I just made an offer on a single family home that was accepted by the seller. I have a lease-purchase buyer and hard money investors ready to do the deal. What I want to do is close directly into a LT and give the investors a percentage of beneficial interest. The two investors each receive a 40% interest and I receive a 20% interest. My question is, how do I provide protection to the lease-purchase buyer? I know how to register an "option to purchase"; but, can the lease-purchaser register his/her interest?
Also, once the Lease-purchaser "seasons" the purchase, I want the contract to require a refinance to pay off the beneficiaries. We have agreed to a two year refinance. The problem is I don't know how to put that into the agreement.
Any ideas would be greatly appreciated. I know you do not offer legal advice, so an idea is all I need. I guess I could do it the same as in a lease-option.
Thanks,
Doc
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Randy Hughes
Land Trust Expert-40+ years of experience
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Re:How to protect a lease-purchase buyer?
Wednesday, January 11 2012 07:12 PM
Doc,
See my comments below in BOLD.
I just made an offer on a single family home that was accepted by the seller. I have a lease-purchase buyer and hard money investors ready to do the deal. What I want to do is close directly into a LT and give the investors a percentage of beneficial interest. The two investors each receive a 40% interest and I receive a 20% interest. My question is, how do I provide protection to the lease-purchase buyer? I know how to register an "option to purchase"; but, can the lease-purchaser register his/her interest?
YES, THE LEASE-PURCHASE BUYER CAN RECORD HIS OPTION CONTRACT AND IT WILL BECOME A LIEN AGAINST THE PROPERTY PREVENTING FURTHER ACTIVITY BY THE SELLER WITHOUT THE OPTION/BUYER'S APPROVAL.
Also, once the Lease-purchaser "seasons" the purchase, I want the contract to require a refinance to pay off the beneficiaries. We have agreed to a two year refinance. The problem is I don't know how to put that into the agreement.TO OBTAIN TRUE SEASONING, YOU WOULD NEED TO SELL ON A CONTRACT WITH A TWO YEAR BALLOON. OTHERWISE, AN OPTION ALONE WILL NOT "SEASON."
Any ideas would be greatly appreciated. I know you do not offer legal advice, so an idea is all I need. I guess I could do it the same as in a lease-option.
HOPE THAT HELPS! RANDY
Randy Hughes
866-696-7347
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