Re: L/O violating DOS clause - then how? - Posted by MIke
Posted by MIke on June 29, 2003 at 14:58:44:
Then how can you do this? What is the penalty for violating a DOS clause? Under what conditions is a L/O valid?
Forgive a noob, but what exactly is a DOSC?
Mike
OK my lease would be a year - so no violation (NT) - Posted by Matt MI
Posted by Matt MI on June 30, 2003 at 10:26:25:
nt
Re: L/O violating DOS clause - Bronchick others? - Posted by MicheleCO.
Posted by MicheleCO. on June 30, 2003 at 01:44:57:
Hi, Jorge, if Bill doesn’t have anything let me know, I can help. Michele
Re: L/O violating DOS clause - Bronchick others? - Posted by JohnBoy
Posted by JohnBoy on June 29, 2003 at 18:08:11:
None. But I never said anything about a lender WILL call a loan. Only that a L/O does violate the DOSC. I never worry about regardless of the method of buying.
When doing a L/O where I’m the buyer I use a lease option agreement. When I’m selling on a L/O I use two separate agreements. A Lease agreement and a separate option agreement. But not because of the DOSC. I use separate agreements when selling on L/O to prevent the lease option from ever being classified as a sale vs. a lease and an option to buy.
Also, when buying on a L/O I RECORD my contract, so if the bank ever checked title it would show up anyway. But when I’m selling on a L/O I don’t allow my buyer to record anything.
As far as the DOSC is concerned, yeah, a L/O does violate it, but so what! As long as the payments are made then it is highly unlikely that a lender would call the loan over it. Even if they did, so what? I would just ignor it. It would still be unlikely the lender would follow through on it by actually filing a foreclosure suit when all the payments have been made and are being made. It doesn’t mean some lender would never do it, but it is highly unlikely. So I’m not worried about it. Besides, there are other options to deal with it if it ever did become a problem.
Re: L/O violating DOS clause - then how? - Posted by MicheleCO.
Posted by MicheleCO. on June 30, 2003 at 01:41:38:
The way a lot of people do this is to do a lease with an option to purchase as two seperate documents.
The option may not be recorded. There is no one notifying the lender that the dos was violated. All the bank knows is that the house is being leased. The agreement is not KNOWN to the bank. They don’t know about it, so they don’t call the loan due, however they have the OPTION to if they did.
MicheleCO.
Re: L/O violating DOS clause - then how? - Posted by JohnBoy
Posted by JohnBoy on June 29, 2003 at 18:15:20:
There is no penalty. It’s not illegal. It’s simply a breach of the mortgage. It just means the lender “could” call the loan, if they wanted to. Even if they called the loan, I would ignor it and keep making the payments. Because even if they call the loan due, they still have to follow through by foreclosing if you ignor it. Highly unlikely if the payments have been made on time and are being made on time. And even if they followed through by foreclosing, do you know how long that takes? In my State it takes a minimum of 9 - 12 months and that is if you don’t contest it and just ignor the complaint. If you respond and contest it, it could take a lot longer and possibly years before they can successfully foreclose. I think I could get the property sold long before that ever happens!
Different States have different laws. So the time it takes to foreclose from State to State varies.
Due On Sale Clause (nt) - Posted by John (Rome)
Posted by John (Rome) on June 29, 2003 at 16:06:44:
nt