Lease Option Questions- Protecting Title In L/O
Hi there,
I am an experienced investor, and I and looking at quite few more L/O deals, and I have a few questions in regards to protecting title to the Lease Option Property.
1. How do you protect the title from any Personal IRS Tax Liens during the time that you have the property lease optioned, if the seller fails to pay their personal income tax, the IRS will put liens on any property that this person's owns. Especially in the situation of a longer term deal where you have a 5-7 year option.
2. How do you protect the L/O Agreement if the Seller declares Bankruptcy? Will the courts liquidate the property(Seller's Assets)?
3. What happens if the Tenant Buyer declares Bankruptcy?
I think this is an easy answer to my third question but I would appreciate Clarification.
4. Would a Subject To Deal be better to protect title from the above questions?
Thanks for your Help,
Matthew
Matthew:
Nice to meet you!
You could avoid IRS Liens, Creditors Judgments, Bankruptcy liquidations and foreclosing on a tenant buyer by properly structuring your L/O within a Land Trust
.
It's Not very complicated to do and can definitely keep things from becoming MESSY.
Hope this helps!
Derrick
Hi Matthew,
Welcome to the board.
This is exactly why we say you need to get the Deed, so you will be the owner.
Because without you being the owner on the deed, all those thing could happen.
Best of luck
John (LV)