Resale deed restrictions

[Mark Yuschak]

I'm closing on a Fannie property in a week or so. I was originally planning on keeping the home as a rental, but rentals really have me fed up. It's still too good of a deal to pass up, so I'm still going to close it. But instead of keeping it as a rental, I'll do some minor repairs and resell it on a land contract for cash flow.

Is a land contract exempt from the resale deed restriction of 20% or more in the first 90 days? Technically the property won't transfer ownership until the land contract is satisfied. How does a title company view this?

[Bill Gulley]

Jimmy, you should have a search done and closing, you don't need to have title insurance as title is not transferred...when the buyer actually purchases, you close and insure that transaction.

If the seller is to retain tax benefits, you do not need to report the transfer by a CFD, if the buyer is to take any tax benefit (interest deduction or depreciation) close and report.

A notice of the CFD needs to be recorded, not the entire contract.