[Don Alexander]

Don Alexander

I am trying to find out how to sell a run down house using a trust.

I remember Jack Miller talking about getting a buyer for a run down house and have them to fix it up and if they did not pay it would be easy to take the house back if you sold the shares of the beneficial interest of the trust.

Please correct me if I am not asking this question in the correct way.

Thanks for your help.

[Jackie Lange]

Jackie Lange

ARe you selling for cash or with seller financing?

If you are selling for cash you really have no way to get it back unless you just tell the buyer if they decide to sell later you might be interested, please call.

The new Dodd-Frank rules will change things a bit. That law also includes trusts.

Instead of selling the house, you would sell the beneficial interest of the trust. You or your company would be the trustee.

You would have a beneficiary agreement that spells out what they need to pay each month and when you need to be paid off. The beneficiary agreement would also state what happens if they default.

[Nickolas Bubolz]

Nickolas Bubolz

I know Jack Miller talked about setting trust up for everything. If I’m talking to a seller about doing a sandwich lease option, would you set one up still?

[Don Alexander]

Don Alexander

Thanks Jackie. I would be willing to sell with owner financing. I think because of the Dodd-Frank rules, I would need to involve a mortgage broker to qualify the buyer.

I am not that familiar with trusts, so I am planning to take Dyches Bodiford’s trust class in October in Atlanta.

The house is in very poor condition.

Do you have other suggestions.

Thanks very much for your help.

[DON WEDE]

DON WEDE

Bubolz,

Do you do your leases in your own name or at the LLC or Corporate Level. I would use one of these instead of a Trust dealing with the lay public. I think the trust concept may scare most people off. I could be wrong. Let’s hear what other CFD members thinks.

Don Wede

[DON WEDE]

DON WEDE

Don,
Since you are not comfortable with Trusts just yet here is an idea. Use a lease and an option. Do a master lease to another entity and the occupant tenant is your end buyer. Set up an option for the end buyer that has some real teeth in it outlining improvement specifications and time limit for these improvements. Use a default clause if any parameters are not met. Put a clause in that ” A performing lease associated with the subject property will be further collateral for the granting of this option. A default in said lease will trigger a default in this option.” Just a thought. Don and others please comment.

Don Wede

[Don Alexander]

Don Alexander

Don,

Thank you for that idea.

Would you suggest using an entity like a LLC to be the master tenant?

Would I be the landlord and as the landlord, master lease the property to the master tenant and master tenant would then lease with option to occupant tenant?

Thanks again.

Don

[DON WEDE]

DON WEDE

Don,

You want to make sure that the Master Tenant and the Optionor or two different entities.

Don Wede

[Nickolas Bubolz]

Nickolas Bubolz

Don Wede,

I do all my work in a LLC. However, sometime when i make offers i will make them in my name and assign the agreement to my LLC if they accept. To make it more personal. I will plan on sticking to the LLC. Also, i do have some rentals that are in my LLC. I was thinking about doing my first land trust my converting one of them into a land trust. Then i will have the experience of a land trust underneath my belt.

[Jackie Lange]

Jackie Lange

For this one… just get an option contract then sell it to a rehabber.

Read the Flip Deals book to learn how. It if free for members. See the New Member Bonuses box at the top left.

Save the trust stuff for later.

[Don Alexander]

Don Alexander

Don,

Thank you for your suggestions.

I really appreciate your help.

[Don Alexander]

Don Alexander

Nicholas,

Thank you for your suggestions and help.

Your ideas are very much appreciated.

[Don Alexander]

Don Alexander

Thank you for your help Jackie.

I have read the book but need to read it again and get my act together.

Cash Flow Depot is the BEST!!!!

Don Alexander

[Jackie Lange]

Jackie Lange

Thanks Don

Let me know how we can help