Lease Optioning a property with a section 8
I have a buyer who has a house worth 42k with a 35k mortgage with a 375 payment. He has a section 8 tenant on the property paying $650 and the property is in excellent condition. He needs to get out ASAP due to changes in his life beyond his control. I am going to offer him to lease option the property and assume the rental agreement.
My question is will the government except this on a section 8?
Hi Ohio_Buyer,
I'm not certain how the owner could L/O the house to you, when he already has the property leased. It sounds kind of messy. Does anyone else have any thoughts on this?
BAMZ
Why not have the owner place the property into a simple Land Trust with himself as sole beneficiary and you as Trustee? I think you have a classic situation for a Subject-To deal.
It would work something like this:
Owner creates a simple Land Trust.
The deed gets signed over to you (as Trustee) and recorded at the courthouse. The owner then signs over his beneficial interest to you (this document and the Land Trust documents DO NOT get recorded)! They are private!
Next, send letters to his lender and insurance company explaining that he has placed his property into a land trust for financial/asset protection purposes and that all matters concerning the property should be addressed to you as the Trustee.
If the owner is willing to wait until the property is "officially" sold for his equity, give him a Prommissory Note for his share of the equity. The PN should state that he'll be paid in full upon selling of the house. He may be willing to just sign the paperwork and walk away! Don't ask, don't get!
Make sure either your purchase contract or you have a CYA letter which has a clause that states that the seller understands his mortgage on the property is going to stay in place!!!
You have effectively taken over his property Subject-To the existing financing. Make his mortgage payment on time each and every month and you'll both come out winners.
This was the quick-quick explanation of a safe sub-to deal. John Cash Locke is a real pro at these. Don't hesitate to seek his help if you don't quite understand any aspect of a sub-to deal.
Hope I was able to help. Keep us posted on how it turns out.
[addsig]