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Landlord Guide Sell Your Home Foreclosure
This option involves selling your present home. However, unlike the “short sale,” this alternative is only feasible for landlords And real estate owners who still have equity in their home. Home equity purchasers have subjected homeowners whose residences are in foreclosure (subject to an active NOD) to fraud, deception, and unfair dealing. Home equity purchasers are persons who acquire homes in foreclosure as an investment and not for occupying. Purchase and sales transactions between an equity purchaser and a homeowner, whose home is subject to an active NOD, are subject to specific provisions of California law. Requirements of this law include standards for the contents of the contract between the equity purchaser and the homeowner. The contract must contain the entire agreement of the parties and is to include (among others) the following terms:
- The name, business address, and the telephone number of the equity purchaser;
- The address of the home in foreclosure (subject to an active NOD);
- The total consideration to be paid by the equity purchaser in connection with or incident to the sale;
- A complete description of the terms of payment or other consideration including, but not limited to, any services of any nature which the equity purchaser represents he will perform for the homeowner before or after the foreclosure sale;
- The time in which possession is to be transferred to the equity purchaser;
- The terms of any proposed rental agreement between the homeowner and the equity purchaser;
- A notice of your right to cancel with specific language as required by law; and,
- A notice of cancellation (with specific language as required by law) to be in at least 14-point boldface type, if the contract is printed, or in capital letters if the contract is typed (word-processed), and the notice must include the name of the equity purchaser immediately above the statement.
The homeowner is entitled to a right of cancellation, and the purchase and sale transaction cannot be concluded and no loan may be imposed on the property by the equity purchaser (or at the request of the equity purchaser) until the cancellation period has expired. Further, the homeowner is not to receive any consideration for their equity until the cancellation period expires. If the homeowner elects to cancel, the original contract or any other document (instrument) the homeowner may have signed must be returned to the homeowner without any condition being imposed by the equity purchaser.
Equity purchasers also are prohibited from making untrue or misleading statements regarding the market value of your home, the amount of net proceeds you will likely receive (if any) after the sale, about any contractual term (including your rights or obligations incident to or arising out of the purchase and sale transaction), the nature of any document (instrument) which the equity purchaser requests or induces you to sign, or any other untrue or misleading statement. You should be aware that it is unlawful for any person (including the equity purchaser) to initiate, enter into, negotiate, or complete any purchase or sale transaction involving your home in foreclosure (subject to an active NOD); if such person, by the terms of such transaction, takes unconscionable (inappropriate and unacceptable) advantage of you.
As part of the proposed purchase and sales transaction, some equity purchasers will offer you the opportunity (an option) to repurchase your home at some future date. The equity purchaser will demand that title to the property be conveyed (transferred) to the buyer/purchaser but that you may stay in occupancy and at some future time exercise an option to repurchase. Such purchase and sales transaction is presumed to result in a mortgage loan rather than a sale of the home, unless the equity purchaser can prove otherwise (which will be difficult to do).
Applicable California law is intended to protect you (the homeowner) from unethical and unscrupulous equity purchasers who are acquiring your home when it is subject to an active NOD. Even if your home is not subject to an active NOD, you may need protection when considering a purchase and sales transaction with an investor seeking to purchase your equity. As you can see from this brief discussion, the law is complex and homeowners would benefit from the advice of an attorney who is knowledgeable regarding real estate transactions.
This is a blog post for Real Estate Professionals, Investors, Landlord, Property Manager, and Property Management Companies. Landlords And Real Estate Owners Guide to Sell the Home to Access the Available Equity is brought to you by SimplifyEm Pay Rent Online and Property Management SoftwareYou might also want to read:
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