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Short sale buyer wants to rent property to short sale sellers

Posted by Jeanette Becker on May 30, 2010 at 2:37pm in Short Sale Discussions
I have a short sale that a buyer from out of the area wants to purchase. For various reasons, she is not able to move to this area until next year.  She suggested that until she moves to this area, she is willing to rent the property to the current owners.  Is there a problem with this arrangement?  The buyer and the seller does not currently know each other.

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Replies

  • Vanessa Calhoun June 4, 2010 at 9:58am
    All of the lenders that I've worked with have prohibited this practice. The sellers will have to move.
  • Kathleen Lordbock May 31, 2010 at 3:33am
    This would then not be an Arm's Length Transaction as the seller would benefit from this arrangement and therefore from the sale. I agree with Bryant- move them out and find the seller's somewhere else to rent and the buyer new renters and you now have new friends and new clients. They may be buying down the road!
  • Bryant Tutas May 31, 2010 at 12:25am
    Jeanette. Most lenders will have a clause in the approval prohibiting this. The sellers will need to move.
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