Paper, Paper....Put It On Paper

Karen, that is sad. The seller got the money and the buyer ends up with nothing but having overpaid for a rental. I also am not a fan of lease option/purchase. I looked into it a while ago for a client and everything I learned about it favors the landlord/seller, even when the transaction is done with the assistance of an attorney and a legitimate escrow. 

That must have been a hard lesson to learn, lease options can work great if done properly and in writing. Even outside of real estate anything involving money should be in writing, it is the best option to protect yourself.

Karen, many years ago, when I bought my house, it was with this type of arrangement - and I had every single item in our agreement put into a contract. It worked out amazingly well, but it could just as easily not have.  Paper is really, really important!

What a terrible experience for them! My mentor always said, "Paper it now, or pay for it later."

You are so right Karen Fiddler, Broker/Owner and as Sandy Padula and Norm Padula, JD, GRI said have a legal professional do it. Realtors that are crazy enough to "write something up" are risking everything they own and more if a case ends up in  court.

How sad. This happens a lot more than we realize. If we write about it often enough maybe more will become aware of it and not go this option. Or at the very least go into it with an attorney's written point of view.

Karen your advice is sound.  There are just too many scam artists out and about right now.  One can not be TOO careful.  Mark

Hi Karen Fiddler, Broker/Owner ,

OMG..so sad for this couple..in Texas no verbals..only in writing..as it should be!!

Awesome awareness post, Karen. People that are desperate are at a disadvantage when it comes to decisions such as these. Sadly, they become easy prey and it becomes more of a sad situation.😟

Karen Fiddler, Broker/Owner, Tough lesson learned the hard way. Sorry for them.

I don't like lease options. When folks consider this, I tell them they must hire an attorney and have them draft the documents that will protect them. 

Great point:

Work with an attorney...not even a real estate professional...a lawyer. Do your homework, know the credit history of the landlord and put it in writing, If they had it writing things could have been different

How awful for that young couple who lost all that money.....everything needs to be in writing.....everything. 

Yet another example as to why Buyers need representation.

Wow! What a shame for those folks.  Had not thought of this, so it's definitely an aha! moment for me.

Karen Fiddler, Broker/Owner Too bad for this young couple. More than likely not much they could do even if it were in writing. At the least the funds should have been put in escrow.

I couldn't agree with you more Karen!  We just had our MLS revise the listing with a lease option.  I can't stand them, and I caution buyers.  If they can't get financing now, in two years (which goes by so quickly) and their credit still sucks, they're going to risk their lease option money.  

Lease options, like many other creative financial systems are very useful tools if used properly.

They must be prepared by an attorney, and of course they must be in writing.

But there are as many instances of sellers getting the short end of these kinds of deals as there are buyers. There are predatory buyers as well as sellers.

That is so sad for that couple who have lost all and no longer have  place to live.  The landlord just pocketed their money and must not have paid the mortgage. That is criminal

Karen Fiddler, Broker/Owner get everything in writing. In fact, you mentioned, verbal contracts do not exist in CA - and that seems to be true for all states, to best of my knowledge.

(He said, she said does not work in court in such cases.)