Financing / Lease Option Question - Kinda Long - Posted by Kevin - WA
Posted by Kevin - WA on April 28, 2007 at 22:11:14:
Thanks in advance for your help on this. I will share a bit of background.
I have a house that I have been having trouble selling. It is a nice house in a nice neighborhood, but the market has slowed. I am sure it will sell, but it is empty and costing me $1600 a month to hold it. I have to make my third vacant stroke on it this week. I got this house in 2005, lease optioned it twice, had those deals fall apart and have gotten it back twice. I took $15,000 in option fees on it so I am OK financially, just do not want to hold it empty for a protracted amount of time, and don’t want to start discounting it and leave money on the table. It is priced fairly, just a slow market.
Now, I got a call today. Lady was divorced, is self employed for 1.5 years, and can’t get a bank loan. She is very interested. One of her issues is that she is looking to “buy with owner financing” so she can benefit from a tax deduction for the mortgage. I would prefer to do a lease option, because if this blows up in a year or so, I do not want to have to foreclose to get the deed back. Plus there is a first and second mortgage on the house, so I don’t want to have a problem with possible due on sale, etc. I have it in a land trust currently. Again, though - I don’t want to give up control of the house until I can walk away from it.
My question is “is there a way that she can take a tax deduction as a tenant in a lease - option situation”, or is that not workable?