Should Seller's Option To Buyer Be Recorded?
For benefit of the buyer, to get a good deal upon purchase, lenders say that the option should have been recorded - I think. This gives them the benefit of payments already made toward the purchase price. I don't even know why recording is necessary if a contract can be shown along with proof of payment by the buyer.
BUT (and this may be true regardless of recordation), if an eviction were necessary, the buyer could claim equitable interest in the property.
Can you wait until the buyer is getting financing to record the option?
AND, the dreaded DOS clause. Not especially concerned here, but why put something in public records showing I'm selling the property?
AND, what if the tenant-buyer skips? Is the title clouded, and what hurdles would I have to jump in this scenario?
Any input appreciated.
I not only prevent the T/B from recording the Option, but my Option states that the act of recording it renders it of no legal force and effect.
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So, what about the T/B's new financing?
Is it true that the option must be recorded for the lender to more favorably treat it as a "refi?"
I'd want to make it simple for the T/B to exercise their option without putting myself at risk.
These lenders generally only want a signed Contract and 12 consecutive on-time rent payments (12 canceled checks).
[addsig]