Re: Would you accept a bankrupt L/O tenant? - Posted by JPiper
Posted by JPiper on January 04, 1999 at 02:23:38:
Prospective borrowers can get FHA financing in 2 years. Conventional financing may be 3 years. Nonconforming financing maybe in 1 year. I?ve heard of loans quicker than that. By the way, this has been the case for quite a few years now?..it isn?t something new.
As it pertains to lease/optioning your property, I?ll give you a personal opinion. I like people with bankruptcies. Here?s what I look at. I look at the reason for the bankruptcy. I look to see if something has changed. Keep in mind that one of the positives of bankruptcy is that it wipes your debt out. What this means is that the only payment they have is yours. I require cash upfront for option consideration. Cash talks. If they have enough cash, I?m not particularly worried about it as to whether they default?.but chances are they won?t.
You don?t mention much about this guy, so there?s not much that can be said. Pull the credit report. Verify the income. Take a look at the stability of the jobs. Find out what?s been going on since the bankruptcy. Banks will accept a bankruptcy. What they won?t accept is negative credit subsequent to a bankruptcy. That?s a big no-no. Find out how much cash he has.