Practice Areas

• Documents Recording
• Asset Protection
• Basics of Leasing
• Seller Financing
• Mortgage Fraud
• Library of Forms
• Land Contracts and First Time Home Buyer Credits FAQ's
• Landlord-Tenant Law
• Business & Commercial Law
• Business Litigation
• Real Estate Law

BEST FOR SELLER: LEASE/OPTION TRANSACTION:

1. Buyer is "mere tenant." Removal for default requires only an "eviction" action. Eviction actions take about 5 weeks, start to finish.
2. Monies paid for the Option are set up as consideration only for the Option. Nothing is allocated for a "security deposit." In the event of default, Buyer forfeits the entire deposit, and is still accountable for damages and past due rent.
3. You can be creative - e.g., apply (for example) $100.00 per month for rent paid on time to payment of the Purchase Price.
4. Recording of the documents in the public records is optional, not mandatory.

BEST FOR BUYER: DEED TO BUYER SELLER CARRY-BACK MORTGAGE:

1. Buyer has "full title" to the real estate.
2. To remove Buyer from the premises, Seller must conduct a full foreclosure.
3. Foreclosures take anywhere from 6 months to 2 years or more, depending upon how hard the Buyer fights. A bankruptcy by Buyer can delay this even more.

"MIDDLE GROUND" - LAND INSTALLMENT CONTRACT

1. 1. Document must be recorded - provides greater protection than Lease/Option, where recording is discretionary.
2. 2. Until Buyer has paid either (a) 20% of principal; or (b) the Land Installment Contract has been in place for 5 years, Seller can remove Buyer upon default through a "forfeiture" action in Housing Court.
3. (a) Seller must give Buyer 30 days to cure default from time of notice of default.
   (b) Thereafter, Seller must give Buyer a "10 Day Notice" to vacate before Seller can file the "forfeiture" action.
   (c) Thereafter, process takes approximately same time as an "eviction" under a Lease/Option transaction (approximately 5 weeks).
4. Buyer under a Land Installment Contract is liable only for payments not already made, and not for any payments to be made in the future.

OTHER CAUTIONARY MATTERS:

1. Disclosures: For both Lease/Option transaction and Land Installment Contract transaction, all disclosures should be performed up front.
2. Point of Sale: You need to plan ahead for determination of who will perform repairs as required by any point of sale requirement.
3. Commissions: Try to get as much money from the Buyer up front to cover your commission, if you are a real estate agent. You can also consider taking a mortgage against the property to make sure that your commission is covered when the sale occurs.

HOW WILL BUYER EVENTUALLY GET A LOAN AND PAY ME OFF?

Generally, as long as cancelled checks are maintained to show a history of payment, a qualified Buyer may cash you out by obtaining "refinance" financing on the subject property. The transactions referred to herein are often used as interim measures pending the improvement of the Buyer's credit and/or the making of improvements to the property so that it becomes good collateral for a bank loan.