Posted by JPiper on April 23, 1999 at 24:15:14:
Yes, you could lease/option from a seller with a land contract or two. But I probably wouldn?t.
First, the question arises as to how confident you are that you will get a deed if you exercise that you can pass on to your tenant buyer if he exercises. The answer is that you have no assurance that there won?t be a problem. And if there is a problem, you can?t deliver to your buyer. That?s what they call a “mess”.
Next, this deal has no equity. Taking the above risk for no equity would be foolhardy in my view.
Finally, you have a deadbeat tenant occupying the property, who someone has to evict. If that someone is you, that means you have a carrying cost and eviction costs, which will partially offset any upfront option consideration that you may receive from your tenant/buyer.
If I attempted anything in this deal…I would attempt to offer the seller a deal where I take over the contracts, subject to my approval of the contract. I would then try to discount the value of those contracts with the original seller. If I could get a serious discount the deal might interest me.
Your chances of this however don?t appear bright. It sounds like the original seller knew exactly what he was doing.