Yet Another DOS Question
Hello,
I am new to Subject To investing. I have a few questions and would appreciate anyone helping me out:
1. If the lender is stubborn enough to exercise the Due-On-Sale clause and if I decided to walk away (say a year after the sale), what are other consequences besides the home being foreclosed?
2. How would I take care of my tenant buyer who has signed a 3 year lease with option to buy and moved in for a year already?
3. How would I take care of my seller?
4. Would it hurt my credit or the seller's?
You can probably say that I am an analysis freak, but I just got to know.
Thanks,
Joe
This one is simple.
You dont walk away!! You have an obligation. Dont do any sub2 deal that you cannot back one hundred percent. This is a business not a deal of convienence or a hobby that you can put down when you are bored or get in a jam.
I am disappointed to see that you think that way.[ Edited by WheelerDealer on Date 02/14/2004 ]
Absolutely right.
In fact, if you did just walk, I'd bet you're going to be getting sued by the L/O tenant/buyer whose rights have just been walked on by you.
You made a deal with the L/O buyer to sell him/her certain rights and you're now welching on those rights.
I'm in the middle of a deal just like this, where the seller didn't keep up their loan payments, but sold on L/O, taking a pretty hefty option payment upfront, and now the RE is being foreclosed...the sellers are hiding from the buyer, the buyer isn't paying, and the property is going to auction in a couple of weeks...in short a mell of a hess!
So you're not gonna be getting any encouragement from the experienced on this board to just leave.
Do so at your peril.
Thanks for the great replies.
Just to clarify, I don't intend to walk. I intend to be in business and keep my obligations. I am just learning about the business and thought I'd ask.
I apologize to you for sounding accusatory...just speaking hypothetically, and not intending to condemn you personally !
[ Edited by DaveT on Date 02/14/2004 ]
Yes you would be the guy in the middle getting sued by both sides. Just to top it off you may also hear from the Attorney General's office. This is a scenario where everyone would lose.
Thanks again. This is definitely something not to do!