Term "Recycling" - Question About Quit Claim Deed

Comments(9)

• 
  myfrogger4th November, 2003

  Short answer: yes
  Long answer: why??
  
  If you purchase a property subject to the exisiting mortgages on the property, the origional mortgage holder is still ultimately responsible for the mortgages. If you QCD the property back to them they own the property again and still have the mortgages in their name.
  
  Please explain more what you are trying to do so that we can help you better.

• 
  investor776th November, 2003

  Thank you for responding. The owner can't refinance due to loan to income ratio too low.
  
  So, he has asked me to purchase it and qcd back to him.

• 
  BAMZ6th November, 2003

  Hi investor77,
  
  Unfortunately, your friend may be short on options. If he has low loan income ratios, he probably wont be able to afford the house.
  
  You could however, do one of two things. Buy the house from him, and give him some Moving Money to start fresh again. Then resell it, and re-rent it to someone new.
  
  Or you could buy the property and let him rent it back from you?
  
  DANGER: I'll put up family for free, but I never rent to friends. If they get short on dollars, the friendship will dissolve quickly. And if this fellow is in foreclosure, you may be the one that he doesnt pay next!
  
  Best of Success!
  
  BAMZ
  
  [ Edited by BAMZ on Date 11/06/2003 ]

• 
  flynny6th November, 2003

  Buy the property and then L/O it back to him. If you quit claim the propoerty back to him without any deed of trust or the like, he can walk away with a property free and clear and you are left holding the bag.

• 
  BAMZ6th November, 2003

  If you do a L/O in this situation, be aware that you may fall into Preditory Lender or Usury Laws! That could be big trouble.
  
  There have been several post about this type of situation before if you want to read the details!
  
  BAMZ

• 
  bansal6th November, 2003

  I might be able to help, I have several loans that allow you to state your income so he can refinance. See my profile for contact information.

• 
  flynny6th November, 2003

  Bamz,
  
  If he was to buy the property and lease it back there is nothing illegal about that. If he did a sub-to and kept the original tenant in place he could incur a tremendous amount of liability. Those are the facts.

• 
  BAMZ6th November, 2003

  Flynny,
  
  Read the post. If he bought the property and leased it back to the previous owner, there certainly is nothing illegal about that. However if he tries to L/O the property back to him, that is where it could get messy.
  
  I appreciate your "FACTS", but I didnt mention anything about Sub-2 in the above post.
  
  BAMZ
  [ Edited by BAMZ on Date 11/06/2003 ]

• 
  investor778th November, 2003

  Thank you all for your replies. They are all something to think about.
  
  We will be meeting next week to discuss and we'll see what happens. I'll keep you psoted.
  
  Thanks again!