Original Owners Encumbering The Property
Has anyone ever run across the problem of doing a lease/option, and then a few years down the road, when you are ready to redem your option, you find out they have encumbered the property so deeply, that you can no longer purchase the property? Any thoughs on how to avoid this?
thanks,
Arch
Arch,
In order to avoid this you should require that an AFFIDAVIT AND MEMORANDUM OF AGREEMENT be recorded in the county court house just as a mortgage would be recorded. This would tell the world that you have an interest in the property and any mortgage company or lending institution that would go to lend money on it would then know of your interest. You could also record the agreement of sale however this would also show all the terms and things in the agreement
Terry
Get a performance mortgage signed and recorded. This will guarantee their performance of the contract and your interest in the property. This will stop the owner from encumbering the property any further.
I also suggest getting all of the paperwork signed and in escrow so that when the time comes to buy you will not have to hunt down the owner. Just pony up the money and you get the deed.