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What Do You Think About The Short Sale Lease Back Program?

Posted by Peter J Kim on February 8, 2013 at 8:54am in Short Sale Discussions

Hi guys,

Wondering what your thoughts were on the short sale lease back program that is starting gain traction in the short sale arena.

Short sale lease back programs have been around for quite some time now. In an SSLB program, the homeowner short sells their home and subsequently rents from the new owner upon closing the sale.

Do you think this is a good idea for the homeowner? What have you seen? Any other thoughts?

Thanks!

Peter

Full Article: www.seattleshortsaleblog.com

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Replies

  • Paul (No Bad Days) Smith April 5, 2013 at 12:04pm

  • Oggie Penev April 3, 2013 at 3:56am

    Could anybody recommend a non-profit that has a leaseback program in Arizona.

  • Melvin Vy February 22, 2013 at 5:03pm

    I see every post in here talking about short sale lease back program offer by HAFA.  Today, I will introduce a short sale lease back option provide by private real estate investment company.  We have been working on it in the last 4 years in east coast.

    Agent opportunity is available.  If you are interesting to know more about our program, please email me, i will send you more information.

    Melvin

    realestate.vy@gmail.com

    • Jeffrey Burnham > Melvin Vy February 23, 2013 at 9:14am

      .

    • Simon Campbell > Melvin Vy February 23, 2013 at 1:27am

      Before you start the program, you better make sure that you are not in violation to the short sale agreement. They have a clause in them that does not allow a lease back.  Unless you are an approved not for profit organization, you cannot get around this clause.

      Any lease back to the original owner when this terminology is part of the purchase would be subject to fines and penalties, if not court action.  The number of qualified lease back situations are going to be far and few between and it would be a disservice to hold that carrot out to a property owner.

  • Simon Campbell February 16, 2013 at 2:58am

    Watch the sales documents. Most transactions require that it be an "arms-length" transaction.  You will see wording like this in the statements: "The Buyers and Sellers nor their Agents have any agreements written or implied that will allow the Seller to remain in the property as renters or regain ownership of said property at any time after the execution of this short sale transaction. None of the parties shall receive any proceeds from this transaction except the sales commission."

    Any lease back to the original owner when this terminology is part of the purchase would be subject to fines and penalties, if not court action.  The number of qualified lease back situations are going to be far and few between and it would be a disservice to hold that carrot out to a property owner.

    • Jeffrey Burnham > Simon Campbell February 16, 2013 at 6:45am

      So I keep hearing that this is possible with non-profits....is it possible for a non-profit to over-ride this clause? Do you know?  Does ANYONE know?

      • Simon Campbell > Jeffrey Burnham February 23, 2013 at 1:24am

        There are certain programs which allow homeowners to stay in home and either rent or buy back. A new supplement to the HAFA guidelines "amends this restriction to allow servicers the discretion to approve sales to non-profit organizations with the stated purpose that the property will be rented or resold to the borrower, so long as all other HAFA program requirements are met."

        The problem is that it has to be a legitimate and approved non-profit organization. I believe that the lease can be up to 3 years long and afterward they could sell it back to the original owner.

      • David Zagorsky > Jeffrey Burnham February 16, 2013 at 8:05am

        We need to put on our Super Star cloaks - Super Men / Women that we are. :) - and develop an incentive to the decision maker to want to make this deal.

        Whether it is involving $ from the Neighborhood Stabilization Act or some other Fed. program or a "be a good guy and help" pitch, let's think creatively to get this concept moving.

        With the proper structure SS Lease Back can be a Win for all parties.

        • Judi Fiolle > David Zagorsky February 16, 2013 at 12:01pm

          Good idea David. It can be a big win-win for everyone involved in this. The homeowner gets to stay in their home, the bank gets money and the home is never left vacant, the non-profit gets a guaranteed buyer within 3 years and rent in the meantime. There is really no downside to this sort of transaction. It does eliminate those stupid modifications and just think how happy everyone will be to get all of that inventory off of their books....I am looking forward to getting all of the information and getting certified to do these in March....an agent/broker does have to be certified in order to do these though and as far as I know, only 1 has been completed so far.....

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