Lease Option Title Seasoning
hell-o all
Say I get a home under a lease option,two years go by and my buyer decides to buy how do you all get aroud the title seasoning issue...Do you set up a HML that does not have that problem or do you ?????? Thank you for your input..................Matt 
Provided I understand your situation, you shouldn't have any problem finding a lender. Two years is plenty of seasoning.
-Chris
[addsig]
The only thing is is that when I go to the double close and close with seller and then close with buyer,,I've only owned the home for five minutes,,,,I thought that would fall under the title seasoning issue.....thanks ,,,,Matt
Can't you give an assignment to the new buyer, and do one closing, and eliminate excessive taxes for gain as well?
Good idea ozzie,,,,,,,,,,thanks,,,,the only thing is I might not get as much for a assignment then I would with a double close,,,but I've never done either so I don't realy know yet,,,thanks,,,,,,,Matt
I have been searching for an answer for this same problem for a couple of weeks. I have been able to come across one idea that made sense. however, I might need help with all the details.
Solution: Create a Land Trust and name it after the Seller. Example (Jones Home Family Trust). Then, Have the seller deed the property to the Trust (This has to happen before the closing). They would still be in control/ownership of the home because they would still be beneficiary. At closing, the seller assigns his beneficial interest to you, and resigns himself as trustee. This would in turn make you the successor trustee. You now can sell the property and sign as trustee to close. NO MORE DOUBLE CLOSING, NO MORE SEASONING ISSUE! If the Lender checks chain of title, all they see is that the seller has owned for years and recently put his asset into a trust.
Consult with your attorney on this. This is where it gets foggy to me. To my understanding, the escrow company/title company has a lot to do with this. They have to secure the sellers interest in the property. There has to be side agreements drawn up that state if the closing does not take place, the Original seller is still Trustee. In short, if the deal does not happen, everything returns the way it was.
You can also take this a step further and have all of this organized before the Tenant Buyer ever even thinks of buying. I would recommend that you get all this paperwork/trust stuff filled out and placed in escrow shortly after the Tenant buyer moves in to the property.
The only problem i see with this solution is: What if you can't locate the seller when it comes time to close? After all, you do need them to close don't you?
Here is an idea! What if you don't need the seller at the closing. Follow me on this.
1) Make trust
2) Make agreement with seller that states the following:
"In the event of the sale of this property, Seller assigns all beneficial interest to investor . Seller also resigns as trustee."
3)Place the above described document in escrow. If the sale never takes place, the Beneficial interest stays with the seller.
There ya go! I know I may be off on the exact specifics and verbiage of the document that gets held in escrow. But hey, that is for your attorney to work out. I really hope this helps you as much as it has helped me. It is truly amazing how much you learn by trying to pass knowledge on to someone else.
Please feel free to correct me where I may be wrong. I am obviously still a novice. This is an attempt to help, if i am wrong i would appreciate being corrected. -Corey[ Edited by Corey_Osborn on Date 01/29/2004 ]
Heck that even seems like a good solution,,,,,,,,,,,,,,,,,,,I will look into both thanks,,,,,,,,,,,,,,,,Matt
[ Edited by mjdreal on Date 01/30/2004 ]