CA Question

[Shar NJ 1]

I have a couple CA prospects and hope to have a house under contract by this weekend.

 

Once the contract is assigned I am totally out of the transaction? What if there is a problem with title, home inspection, or appraisal when it comes time for them to exercise the option? Has anyone had buyers or sellers come back to them in the event of a problem?

 

Super excited about getting some houses under contract as I have some buyers already as well! Thanks!

[Skyland Properties 0]

I can't answer your question directly from experience, but there is well seasoned (albeit a bit crotchety) investor by the name of LeaseOptionKing, that writes on TCI (http://thecreativeinvestor.com/) about how you can never fully relieve yourself of contract liability in a CA, regardless of what the contract states.

 

I think CA are great, but there is still a chance that you could get roped back in down the line if something bad does happen..

[MichaelC 160]

Ask six attorneys this question, Shar, and three will line up on one side of the argument and three on the other side. Unfortunately, that's the way our legal system works.

In the real world, for all intents and purposes when you assign your deal you are out of the loop from a legal standpoint. Does this mean that if something happens the homeowner or your buyer couldn't blame you and come after you with an ambulance-chaser attorney? Of course not. In law school the students are taught to cast a wide net and sue anyone and everyone. Something will stick.

Don't let this scare you off. Run your business legitimately and the likelihood of you being in the middle of an ugly legal battle from doing a CA is fairly remote. Not 100%, of course. But nothing you should dwell on or lose sleep over. In fact, I'd say these transactions are one of the least likely to cause you any grief.

[pilot76180 51]

Just do as MC's manual states, and use a Private Mail Box, a fake name, and change cell #'s often.

[MichaelC 160]

Don't forget the fake nose and glasses mask that I include for free with every manual.

[<Steve> 82]

Don't forget the fake nose and glasses mask that I include for free with every manual.

...missed it bummer. That must have been included in the 2nd edition of the manual.

[Shar NJ 1]

Funnnnny! Thanks guys, I appreciate your help...and humor! I will let everyone now how things go.

 

Shar

[pilot76180 51]

I think I will take some time off, drink some fine tequila, and make a post entitled "Shades of Grey". I would say that although a large number of situations in a LO are black and white..there are also a number that fall into Shades of Grey. Those that are Shades of Grey, if they arise, require a person to say, well...let's take a step back and see what can be done...unfortunately (not in your case Shar) it is the Shades of Grey that prevent people from actually making a go of LO's, or anything involving real estate, or trying to direct their own destiny...

[Shar NJ 1]

I am just going to keep thinking positively, push away my fear, and do it! Prevent as many problems as possible and handle anything unforeseen as it comes up. Thanks everyone

[speedingpenguin 19]

Trust me Shar, just do it the best you can and if things don't go perfectly as planned, you WILL survive, you WILL do other deals (most of which will go smoothly), and you WILL learn from every mistake you make! I'm gonna quote one of my favorite Bob Parson's 16 Rules for Success in Business and Life in General:

 

4. With regard to whatever worries you, not only accept the worst thing that could happen, but make it a point to quantify what the worst thing could be. Very seldom will the worst consequence be anywhere near as bad as a cloud of "undefined consequences." My father would tell me early on, when I was struggling and losing my shirt trying to get Parsons Technology going, "Well, Robert, if it doesn't work, they can't eat you."