Deed of Trust Question

What is the name of your state? MO

I am interested in a house in my state. The seller has offered a lease option of one year so that I can work more on my credit. There is a deed of trust on the property and I want to know if it affects the sellers ability to sell and how it might affect me in the long run if the seller defaults.

Thanks

[HomeGuru]

Originally posted by lwoods32
What is the name of your state? MO

I am interested in a house in my state. The seller has offered a lease option of one year so that I can work more on my credit. There is a deed of trust on the property and I want to know if it affects the sellers ability to sell and how it might affect me in the long run if the seller defaults.

Thanks

**A: please post the exact clauses in the document that references the sale or lease of the property.

Tenant is agreeing to deposit sum of $500 to hold position to rent to own property located (address), All of tenants deposit will apply towards purchash of said property (it will be considered as part of tenant's Option payment) provided tenant lives up to all other terms of his/her agreements with Landlord. This depsoit is non refundable and tenant must pay addition 2000.00 option consideration by 10/01/03 and first months rent of 700 before moving in. If either of these payments is not received by landlord on time then lanlord may at landlords sole discrection cancel agreement with tenant and all money shall be kept as liquidated to cover application review, marketing costs to fil property and lost opportunities. This agreement is subject to final approval.


Okay, I stopped typing. I have this agreement and he wants to sign an additional one that is the lease option after all monies are paid and a rental agreement. I haven't seen the lease option yet, should I ask to see it?

May I add that this agreement is not with the owner of property but owner's son. I made the check out to his father(owner) but the agreement is signed with son? Spoooky
Thanks

And, since I do not have the lease option yet, should I make sure that they reference the deed of trust in the option, If so how.

Thanks

[HomeGuru]

Clarification: I meant to post from the deed of trust document and not from your lease option document.

Gotcha!

It is 12 pages long, is there something specific you are wondering about?

Never Mind - I re-read and here it goes....

Due on Sale - Consent by Lender. Lender may, at Lender's option, declare immediately due and payable all sums secured by this Deed of Trust upon the sale or transer, without Lender's prior written consent, 0f all or any part of the Real Property, or any interest in the Real Property. A "sale or transer" means the conveyance of Real Proerpty or any right, title or interest in the Real Property; contract, contract for deed, leasehold interest with a term greater than three years, lease-option contract, or by sale, assisgnement or transefer of any beneficial interest in or to any land trust holding tittle to the Real Property, or by any other method of conveyance of an interest in the Real Property. However, this opition shall not be exercised by Lender if such exercise is prohibited by federal law or by Missouri law.

Originally posted by lwoods32
Never Mind - I re-read and here it goes....

Due on Sale - Consent by Lender. Lender may, at Lender's option, declare immediately due and payable all sums secured by this Deed of Trust upon the sale or transer, without Lender's prior written consent, 0f all or any part of the Real Property, or any interest in the Real Property. A "sale or transer" means the conveyance of Real Proerpty or any right, title or interest in the Real Property; contract, contract for deed, leasehold interest with a term greater than three years, lease-option contract, or by sale, assisgnement or transefer of any beneficial interest in or to any land trust holding tittle to the Real Property, or by any other method of conveyance of an interest in the Real Property. However, this opition shall not be exercised by Lender if such exercise is prohibited by federal law or by Missouri law.

[HomeGuru]

Originally posted by lwoods32
Never Mind - I re-read and here it goes....

Due on Sale - Consent by Lender. Lender may, at Lender's option, declare immediately due and payable all sums secured by this Deed of Trust upon the sale or transer, without Lender's prior written consent, 0f all or any part of the Real Property, or any interest in the Real Property. A "sale or transer" means the conveyance of Real Proerpty or any right, title or interest in the Real Property; contract, contract for deed, leasehold interest with a term greater than three years, lease-option contract, or by sale, assisgnement or transefer of any beneficial interest in or to any land trust holding tittle to the Real Property, or by any other method of conveyance of an interest in the Real Property. However, this opition shall not be exercised by Lender if such exercise is prohibited by federal law or by Missouri law.

**A: then that's your answer.

My question was, if the seller doesn't pay if demand is made how does that affect me and does the seller have authority to sale if there is a deed of trust on the property.

[HomeGuru]

Originally posted by lwoods32
My question was, if the seller doesn't pay if demand is made how does that affect me and does the seller have authority to sale if there is a deed of trust on the property.

**A: did you not read the clause that you posted?

Thanks for all of your help

[HomeGuru]

The bottom line is that the mortgage lender must consent to any lease or sale.
Now there are other things to be concerned with such as as you mentioned, a seller default. In a lease option, there should be 2 contracts. That being a lease and the other the option. You need protection clauses also such as at the time of lease, the seller shall not further encumber the property with any liens, refi, second, heloc mortgages etc., the seller has clear title to the property**************..
Suffice to say, you would be prudent to have an attorney assist you.