Due on Sale Clause

[JJBlayde 0]

Can Due on Sale clauses be excercised on lease/options? I've heard some gurus say yes and others no. So now I'm confused.

 

If it can be excercised, where would that put me, the seller, and the T/B'er? What steps would I have to take then to remedy the situation?

 

And I know this isn't a sub2 forum, but I'm going to ask this question anyways

 

If a due on sale clause is excercised on a sub2, what position does that put you and the seller in? What steps would be taken to remedy the situation?

 

Thanks for any answers you can give me

[MichaelC 160]

JJ, yes, a Due on Sale Clause can likely be exercised by the lender, assuming that is written into the agreement. Now, having said that, I have never had that happen to me in around 18 years of doing this. Nor do I know anyone else who has had the DOS called. I've heard stories, but from personal experience, I've never been affected. Should this remote possibility occur, I imagine the burden falls to the homeowner, since they are the ones who would then need to refi.

[Tmartinloan 0]

With So many foreclosures I think it would be highly unlikely that the lender would exercise the due on sale clause, as long as the payments are on time.

 

Thomas Martin

[MichaelC 160]

Good point. These days the banks will accept money from whatever source it comes from.

[JJBlayde 0]

Yea. Seems like its a rarity indeed. I've read like 5 different gurus with a combined experience of probably over 100 years all who've said the same thing. They've never had a due on sale clause called on them and never have any of their students had to deal with it either. So I guess I won't worry about it. Thanks guys