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 dwight_banks
Joined: 04 Jan 2008
Posts: 2
1.68 Dollars($)
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 Posted: Fri Jan 04, 2008 11:29 am Post subject: In a lease with the option to purchase contract can the sell |
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| The buyer is looking to enter into a lease with the option to purchase agreement. Buyer want to be quitclaimed on the title in order to have seasoning and to have the final purchase treated as a refinance in order to remove equity for updating the property. |
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larry
Joined: 27 Jun 2007
Posts: 3328
473.51 Dollars($)
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| Posted: Fri Jan 04, 2008 12:10 pm Post subject: |
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Hi dwight_banks,
Welcome to the forum,
I think a lease purchase contract and a quitclaim deed is two different things. If the buyer chooses to lease purchase contract then I think the seller needs not to quitclaim the property to the buyer.
To understand better the lease purchase contract you can take a look at - "http://en.wikipedia.org/wiki/Lease_purchase_contract"
Hope this will help you.
Feel free to ask if you have any further questions.
Best of luck,
Larry |
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dwight_banks
Joined: 04 Jan 2008
Posts: 2
1.68 Dollars($)
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| Posted: Fri Jan 04, 2008 12:18 pm Post subject: In a lease with the option to purchase contract can the sell |
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| I undertstand they are to different things.. i just wanted to no that can a quitclaim deed be executed to place the buyers on title along with the seller. If this can be done it would allow for the buyer's to refi home and pull out equity at the time of purchase. |
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larry
Joined: 27 Jun 2007
Posts: 3328
473.51 Dollars($)
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| Posted: Fri Jan 04, 2008 12:44 pm Post subject: |
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Hi dwight_banks,
Welcome back,
Here the fact is if you wish to execute a quitclaim deed, then the seller has to quitclaim as a grantor. So is the seller willing to quitclaim? Because if he quitclaims, the tenant or buyer will also have the ownership.
In a lease with option to purchase contract, the seller serves as an investor and the tenant/buyer pays a deposit to the seller with a non-refundable option and then also pays rent on a monthly basis. The tenant can buy the home anytime during the lease period. So why does the tenant needs to refinance the mortgage when the seller serves as an investor.
Best of luck,
Larry |
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lisascherzer
Joined: 04 Jan 2008
Posts: 755
1.03 Dollars($)
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| Posted: Fri Jan 04, 2008 9:57 pm Post subject: |
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Quit claiming your property before receiving funds would be pretty risky. There are mortgage lenders that will still lend with no money down. I think this is the best way to go. It will protect your interest.
[Links removed as per forum rules. Thanks.] |
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Vincent Polisi
Guest
0.10 Dollars($)
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| Posted: Sat Jan 05, 2008 7:21 am Post subject: Lease Purchase/Lease Option |
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In a properly drafted and executed lease purchase or lease option agreement, the tenant/future buyer does not have to be on title for seasoning and equity purposes to treat the transaction based on appraised value instead of future purchase price. Each Investor (Lender) is different and has different guidelines (and with the present mortgage market, these can change daily) but a great many Investors will allow the transaction to be based on appraised value with either 12 or 24 months seasoning, provided the contract was drafted properly. It can be disastrous for a Seller to place a potential future buyer on title without protective clauses. If the tenant/future buyer is concerned about ownership interest, a better avenue, if your state allows it, is a Contract for Deed which will define specific terms under which the tenant/future buyer will be placed on the title (typically once all or a significant portion of the outstanding purchase price is paid).
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lisascherzer
Joined: 04 Jan 2008
Posts: 755
1.03 Dollars($)
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| Posted: Thu Jan 24, 2008 1:54 am Post subject: |
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Don't quit claim the house to anyone that hasn't paid for it.
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livinginnky
Moderator
Joined: 08 Sep 2007
Posts: 596
23.69 Dollars($)
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| Posted: Sat Jan 26, 2008 11:21 am Post subject: |
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| Quote: | | The buyer is looking to enter into a lease with the option to purchase agreement. Buyer want to be quitclaimed on the title in order to have seasoning and to have the final purchase treated as a refinance in order to remove equity for updating the property. |
Well that wouldn't really be a lease option now would it. What you are referring to is a land contract. I guess it doesn't matter what you call it but technically a lease option purchase is very literal to the way it sounds....
IE. It is a lease (no quitclaims with leases) and an option to purchase by such and such a date. That is all.
What you are trying to do is trick the bank into thinking that it is a refinance of a land contract without the risk of such a contract. Well the risk has to be there.... With a lease option there are risk as well... you just need to figure out which risks to take and which risks to avoid.
All told and with the limited information we have. I would not recommend as Lisa pointed out, quitclaiming anyone for any reason unless the money is there and changing hands. It is that simple.
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Eric Matthews
Mortgage Refinance and Home Loan Guide |
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