Can You Do A Short-sale When Seller And Buyer Are Related?
I would like to do a short sale to buy a house from
my niece. However, HUD (FHA) requires that the buyer
is not related to the seller. How can this be legally
handled? If I had a friend purchase the house to sell
to me (double closing?), would the house have to be
funded twice?
Thanks in advance for your help.
Calvin
Have the buyer as a land trust or LLC and the relative can be the beneficial interest of the land trust or the managing member of the LLC. So that will get you by the requirements of the Short Sell investor (lender, bank,etc) that the buyer can not be a relative. But the bigger question is - how is the relative going to obtain the funding to buy the house? No lender will loan money to buy a house from a relative that is in foreclosure. If you have cash then not a problem. But you will not be able to borrow the money from a standard lender.
Brenda
Are the last names the same... how closely are they related?
"Already disclosed to lender that buyer and seller are related..... "
Tough to unring the bell.... but unless the uncle plans to remain in possession.... I think you could work it thru.
The Uncles would need some evidence that he is actually moving... .like a lease agreement from another town, etc.
Have the buyer as a land trust or LLC and the relative can be th ...
Great idea. I can do a new mortgage on another home to finance the SS if necessary.
Do you think the land trust or LLC will work since the uncle/niece relationship has been disclosed?
Thanks Brenda for your help.
Calvin
Tough to unring the bell.... but unless the uncle plans to remain in possession.... I think you could work it thru.
I disclosed the uncle/niece relationship because I heard that FHA can declare the SS null and void if they find fraud.
The Uncles would need some evidence that he is actually moving... .like a lease agreement from another town, etc.
Uncle will buy house as rental and niece (seller) is in the process of moving. Please explain your comment about the uncle needed evidence of moving ...
Thanks SSP.
Calvin
sorry... the seller would have to show some proof that he/she were moving....
Corear,
Howdy, from a another GA investor. Anyway, not sure what your motives are here. I mean if its to buy the house to sell for a proffit or make a rental then there might be a way here.
But if its to put the niece back in then certainly there is a delima.
If however its for proffit, would you be willing to accept something instead of nothing?
If so, have you thought about doing a partnership on the deal. You could bring a partner in of which could take a smaller percentage since its your deal.
Just an idea.
MarkB
MarkB,
Thanks for your reply. Niece will vacate. Plan to sell or rent property. Currently have a partner that can buy the property and then sell to me. Will keep you in mind if anything falls thru.
corear