Posted by Bill Gatten on November 06, 2000 at 21:17:10:
I will disagree in part with the esteemed Jim Piper here (seldom need to do that, but…sometimes…).
If you approach this seller with the safety and beneficial tax consequences of holding ownership in a land trust in his name with you as a co-beneficiary (the PACTrust), he should feel real warm and fuzzy about that. It will, as a matter-of-fact, shield him and the property from any future unforeseen trouble you might get in to (tax liens, creditor judgments, BK’s, divorce actions, getting dead and having the property tied up in your Probate…or his Probate if he gets that way first).
By doing it this way (using the PACTrust), he has a clear shot at your dispossession if you screw up…without any undue concerns about your claiming “equity” (an equity interest) and attempting to thwart or forestall dispossession in favor of a more lengthy judicial foreclosure process, ejectment, quiet title, etc.
Yes. The PACTrust can work wonders for you here.
Re. the request for subordination…forget it. It’ll make you look like a piker. A lender couldn’t loan to you anyway, as you don’t own the property if its in a land trust.
The best idea is for you to get a partner real quick. An ad in the Business Op. section of your newspaper will do it for sure. “$10,000 buys half interest in in 10 houses with $xxx equity and no payments and no expenses…properties valued at $xxx,000. Urgent!”
And what Jim said about the deposits and advance is excellent and astute advice…most of the money you need may already be there.