Selling a house via Lease Option / Owner Finance under Dodd-Frank

[Dan Costantino]

I have a property that I haven't had much action on. I have about $95k into it. I have it listed for $119,000.

I posted it for rent at $1300/mo and have 4 showings scheduled in less than a day.

I have two people that asked for an owner finance deal. I said I would consider if I had $15k down. Two people claim to have that to put down.

Terms I'm considering:

$125k sales price: $15k non-refundable option consideration, $1000/mo for 24 months with a $110k balloon payment after 24 months. $15k perfect payment bonus (I've heard this is the way to go as opposed to saying the option consideration goes towards the purchase price because it conveys interest in the property........)

I've scheduled a call with my RE lawyer but that isn't until Friday!

I'm trying to structure terms but I can't find reliable resources regarding Dodd Frank.

Can anybody shed some light on a trustworthy resource that is not in lawyer speak?

I will certainly pay my lawyer for advice, but I wanted to get the ball rolling on the buyers that are interested.

Thank you in advance.

[Don Konipol]

Not only do you need to concern yourself with Dodd Frank, but as far a loans made for a consumer purpose, you need to concern yourself with the CFPB as well.

As per your plan of action with the thinly disguised lease option - if you plan to go this route save yourself a lot of time and legal fees....just deed the property over to the tenant/buyers for free. With the penalty of prox $36000 lost payments, $30000 legal fees for your attorney and $20000 legal fees for the plaintiffs attorneys you wont have much left anyway.

And when the attorneys start advertising for clients who have owner financed houses and lease option contracts the courts will be backlogged with lawsuits.