Seller financing and child support

[Molly Trapp]

New to the BP community but psyched by what I’m reading. I’m hoping you all can help me out… 

I've got an owner to whom I'm going to propose seller financing to purchase his house. He has owned it for 25+ years and has no mortgage but does have a $190k lien for child support from 2006. It's a visually distressed house that will need a good amount of work but there's potential for an ADU in the lower level and he owns the rental next door, so I'm hoping we might be able to wrap that into the deal too or eventually buy it, too.

Two questions:

1. Anyone wrapped a lien like this into a seller financed deal? Do you know if it can be arranged that I pay directly into his child support account with the idea that he wouldn’t get taxed on my payment to him and THEN put it toward child support? Just trying to figure out how to sweeten the deal to him. 

2. Also, can part or all of a seller finance payment to the owner go directly into a 1031 account for future generations if he doesn’t want the full payment for living expenses, etc.? Again, to avoid taxes.

I’m in California, if that matters. Thanks! 

Molly

[Chris Seveney]

@Molly Trapp

Any seller financed transaction should use a 3rd party licensed servicer to handle payments etc. I would strongly recommend against paying directly to child support etc.