What Do You Think About The Short Sale Lease Back Program?
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
Replies to This Discussion
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Permalink Reply by Peter J Kim on
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They have the right to live in the property for a minimum of 3 years. 1 year leases at market rate
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Permalink Reply by Marvin Keith Jenkins Sr. on
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Thank you for the information Peter.
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I only know a little about this program but I thin it is great for all involved. As I understand it, home is sold to a non profit through short sale, homeowner then rents it back for a period of 3 years while they repair their credit and then have the chance to buy it back after that time. The homeowner gets to stay in their home, the rent is at a much lower price than the mortgage was and everyone wins. The important thing for us in the business is that you must be certified to perform these SS buy back transactions. FYI In March from the 7th through the 9th at Short Sale Con in Las Vegas, there is a day of this certification slated to take place. In case you haven't yet heard about this. It is going to be the largest conference on Short Sales that we have seen and, most importantly, it is cheap to go to. I understand that only a few people are certified for the SS buy back program so this is going to be a great time to find out about it and get into it. If you are interested in going to this, I think that you can go to www.honish.com to get the details.... this is not an ad for the conference just info on how to get the information SS buy backs and get certified to take part in them.
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I have been viewing this new niche and am wondering if the non-profits use investors as lenders for their purchase of the property otherwise where is the funding coming from?
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Permalink Reply by Jeffrey Burnham on
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As there is often language that precludes the existing homeowner from remaining on the property... I question the legality of this. Seems like a receipe for Mortgage Fraud (unless disclosure is made to the investor.)
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There is a provision in HAFA to sell to a non-profit for lease back to homeowner. Kevin's blog reference on the previous page is informative.
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Thanks David
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Most of the lease back programs that I have seen in the past have been frauds. They would promise a lease back and subsequently increase the rental rates and sell the home forcing them to relocate quickly.
The rates the non profit would provide them would be market rate from what I've heard.
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the non profits must be approved also in order to take part in this new program....this is different than what we have seen in the past from the crooks trying to make a buck off the backs of those in trouble....HAFA is backing this program and it is going to take over what we are doing I think since the majority of the short sales I have worked on have homeowners that want to save their homes.....I hope it takes off big for all of those in such distressed conditions...... homeowners must also qualify for this. There are a lot of criteria for both sides to meet. That is part of the reason why all agents who want to be involved must be certified. This is the start of the program so we can get in at the start.....
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Permalink Reply by Mega-Pros on
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Everything I have come across in the past couple of years regarding lease-back has been fraudulent and predatory so I am excited to see something that appears legitimate. I am going to look into this as well. (Kevin - thank you for sharing the great links, as always!) I also am wondering where the funding comes from for the non-profits?
Here in Washington, like many other parts of the country, we are experiencing large hedgefund buyers coming in and purchasing both foreclosure and shortale properties for holds. I can see the next logical step for investors/hedgefunds would be setting up a 'non-profit' as a shell to give them leverage to purchase with the guise of helping out needy homeowners.
However, I think that could be handled to give the homeowner at least some stability by prenegotiating the lease at the time of purchase offer and agreeing to have the lease recorded in county records so that a multi-year fixed rate lease could be put in place at the outset of the transaction. You would also want to be careful to address the issue of security deposits and walk-through up front and have that agreed to from the outset. I am also a Tenant Broker/Property Manager.
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Can anyone recommend a trainer/company to get Short Sale Leaseback certified or a designation?
Thank you!
Michele Peterson
Keller Williams Realty
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YES, if you are able ...go to Short Sale Con in Las Vegas on March 7th -9th......they will be certifying there.....there is information on this by going to www.honish.com or theshortsaleguide.com......or google it.....this is new and we need to get on baord....I just happened to run across this in the last couple of months and I can't wait to go to this conference....it is really cheap and no upselling is allowed either( my favorite part)
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