Seller finance contract question

[Kendra Penski]

Hi, I am in the process of purchasing a home from an owner who will carry the financing. I would prefer to keep title it in his name to prevent the increase in taxes if it were to transfer to me, however I am concerned about the legal pitfalls of this. Does anyone have advice on the best option? Perhaps a lease option? But even with a lease option how I would I protect from the owner getting a judgment or lien against the property? Thanks in advance for any suggestions!

[Scott Matthew C.]

Hello, I would advise lease to purchase and NOT lease option. This will keep the owner on title until you execute your right to purchase. Prior to locking in a purchase price now get a real look at the local market value from the past three to five years. Analyze the trends. If you feel confident it will trend in your favor, but, it must coincide with your terms and conditions then go for it. There is a lot more to consider prior to locking in an agreed sales price such as getting a title search to confirm ownership, liens, and etc. Do your home work.

To secure your interest in the property, regardless if it's lease option or lease purchase, have an attorney draft "equitable rights" against the title. They may use other verbiage but the owner can not sell the property since you have a vested interest in the property.

Your lease purchase or lease option contract should have language noting the seller can not and will not sell to any other party until you exercise your right to purchase or option to purchase.

Clear as mud? If not search for Lease Option and Lease Purchase here on BP.

Best of luck!