Posted on: 16th May, 2008 10:28 am
I am trying to sell my home and was contacted my who I thought was an investor. However, he offered my an Option to Purchae Real Estate contract and after reading the contract it sounds suspicious and to his benefit only. Are these contracts good for sellers or should I run the other way?
I am not sure why they would do this, maybe one of the people on here that actually work the realestate industry will come by and answer your question. Hopefully you get an answer soon so that you can make the wisest decision. goodluck.
I could explain it myself but I knew I had seen an article that explained pretty well already. This is an excerpt from Mike Mueller's blog. He is a frequent guest on CNN Money.
This is not the way it always works... in fact there are worse things than illustrated here but this does a very fine job of explaining.
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This is not the way it always works... in fact there are worse things than illustrated here but this does a very fine job of explaining.
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Hi Ncav,
An option-to-purchase or lease-to-purchase contract is one in which the seller offers his home on lease to a buyer for a certain number of years and then sells it off to the same at the end of the lease period. But why do you think it's suspicious? I mean aren't you comfortable with it? If you have questions, please ask. The investor will be the best person to answer it because he has prepared the contract. So, clarify all your doubts and only then go for such a contract.
Good luck
An option-to-purchase or lease-to-purchase contract is one in which the seller offers his home on lease to a buyer for a certain number of years and then sells it off to the same at the end of the lease period. But why do you think it's suspicious? I mean aren't you comfortable with it? If you have questions, please ask. The investor will be the best person to answer it because he has prepared the contract. So, clarify all your doubts and only then go for such a contract.
Good luck
Welcome to the forum ncav22,
Without knowing all the details, I would be hesitant to offer too much advice but I do believe the posts above offer lots of great tips.
One thing to watch for when contacted by these people is how the entire transaction will be handled. I would highly recommend that you consult with an attorney before signing anything.
Many times, the "investor" asks you to deed the property to them but keep the mortgage in your name and they agree to make the payments. What does that really mean for you? You owe a mortgage on a home you really don't own; if the person holding your mortgage finds out, they can request the full balance due and payable immediately and also, there is no guarantee the buyer will actually pay therefore destroying your credit.
There are legitimate ways to sell your home via an Option to Purchase. Without full details it will be difficult to give you exact advice regarding the contract you have been presented. Again, it really would be in your best interests to have a real estate attorney review the documents for you. A small outlay now for that could prevent a terrible situation further down the road.
Please feel free to ask any additional questions and we would be happy to help in any way possible.
Without knowing all the details, I would be hesitant to offer too much advice but I do believe the posts above offer lots of great tips.
One thing to watch for when contacted by these people is how the entire transaction will be handled. I would highly recommend that you consult with an attorney before signing anything.
Many times, the "investor" asks you to deed the property to them but keep the mortgage in your name and they agree to make the payments. What does that really mean for you? You owe a mortgage on a home you really don't own; if the person holding your mortgage finds out, they can request the full balance due and payable immediately and also, there is no guarantee the buyer will actually pay therefore destroying your credit.
There are legitimate ways to sell your home via an Option to Purchase. Without full details it will be difficult to give you exact advice regarding the contract you have been presented. Again, it really would be in your best interests to have a real estate attorney review the documents for you. A small outlay now for that could prevent a terrible situation further down the road.
Please feel free to ask any additional questions and we would be happy to help in any way possible.
