I bought a property "Subject To’ and took title in a Land Trust. I am now selling on Contract for Deed and my Buyers are using a relocation package from their Company to assist with their downpayment. They have hired an Attorney to assist with their companys documentation requirements. This has created a couple of small time consuming headaches for me: Survey, Inspection, Appraisal, Termite Inspection, and 5 contract revisions. (The Attorney thought my CFD doc was too Buyer unfriendly
Their Attorney and I have run into 2 last minute snags:
The Title Co. wants to a copy of the Trust Agreement and all supporting documentation showing my Company as beneficiary. (I really don’t want to disclose this until the Buyers are ready to refinance.)
He wants the address of the the couple that I bought the property from. (Because their name is still on the mortgage)
I’m like Mike, when you get these “professionals” invoved then it gets sticky. Let us look at the attorneys view. He is to protect his client. He does this by making sure the money that the company is spending is not being wasted nor in danger of being lost. You can look on it as negotiation they want clauses to benefit them not you. On the aspect of the title company-their job is to be sure you have the right to give title. They think the way to do this is by knowing the beneficiary. If you added the appropriate language to the deed that authorized the trustee to take specific actions then you could point out that that the trustee is empowered to transfer title and they do not have the right to inquire further. One more glitch that they will bring up is the insurance policy. They will want their name as a beneficiary so you will not take all the money and run if there is a major claim paid.
You have to ask yourself is all their hassle worth it. If they could qualify for a new mortgage why would they need to buy subject to. You will have to tell them and the attorney that they will have to qualify or refi if the loan his called due. By definition a contract for deed is inferior. They are just trying to protect themselves from someone that might be unscrupulous. It is hard to turn away a buyer with money so you have to decide if they will agree with your terms or if you will concede and disclose all. You could have a heart to heart talk with them and see if they are going to insist on every thing their way or are they going to back out because basicly they do not want to trust you.
Bill Gatten will tell you about his PACtrust and it will address many of these issues but can you explain to them and their attorney that you will just be leasing but the company’s money will be purchasing an interest in a trust. If there is enough profit potential it may be worth the cost and all the hassles. You are the one that has to make that decision.
