Hey everybody. I'm really hoping someone out there has been in this situation or done this type of deal so they can help me out here.
I been buying and selling mobile homes for 4 years now both cash cash and lease to own financing but this is the first deal of its kind that I got involved with.
OK, here are the details of the deal. I had a seller of a mobile home last year who was going to walk away from it and let it go into foreclosure. He could not afford the mortgage payments anymore after his company closed and lost his job and was moving back in with family. The home is valued at 96k and the current mortgage is 90k
I stepped in and said I'll buy it for one dollar but I have to keep the mortgage in place. So, we did an agreement of sale for $1.00. I also had a power of attorney written up just in case I needed to talk to the existing mortgage company or anything else legal that I needed to take care of.
I told him I was keeping the mortgage in place and was going to resell it to a tenant / buyer that could afford it. I informed him the mortgage would be paid off down the line but not for a number of years. I was just being as upfront as possible. The owner was thrilled to not have the responsibility of it anymore.
I took over paying the mortgage in July. I found a buyer in Oct. Entered into a lease to purchase agreement with the new tenant . The existing mortgage company gets their money, the seller gets relieved of the payments that he can no longer afford and the new buyer gets a great mobile home that he always wanted and I pocket the down money which is the spread between was was owed on loan to what I sold it for. Everyone is happy.
Fast forward to today. The new buyer calls me up and asked me when I'll be sending out the 1098 form for the mortgage interest so he can claim the interest expense on his tax returns. To be honest, I didn't give this much thought. But I want to do right for the new buyer and for the seller for that matter.
What should I or can I do? I'm an LLC, the mortgage payments I pay are almost the same amount I collect from the new buyer except for a couple of bucks. I imagine this is whats called a sandwich lease purchase deal yes/ no?
Any and all input on this subject would be greatly appreciated. Thanks in Advance
