I have recently managed to track down a few motivated sellers of some lake lots in a community within an hour of my home. My purchase prices are in the 20-25% of MV and I am pretty sure on MV after a good amount of research and word from the community manager on what they sell lots for.
My Questions:
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What are my options for selling. Obviously I can sell for all cash, but I am more interested in financing.
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If I do finance, I could sell via contract for deed but I am worried about liability. Say I do not transfer title and take payments, saying I will grant them a warranty deed when all the payments are made. Am I liable if a kid gets hurt on what would be considered my land at that point? Or is it considered “their” land and I am not responsible?
I am wondering how to finance the lots to end buyers AND not have any personal liability in case someone was to get hurt, etc. Any advice?
Create, use corp
You’d only be liable personally if the RE were bought in your name.
But if you form then use corp or LLC to buy and finance, not much chance you’d be nailed personally.
And use of corp or LLC is very discouraging to any lawyer thinking of suing as he/she knows from his/her knowledge & experience that such a suit would likely be fruitless since YOU aren’t connected to such a property.
John provided a good answer. I guess I am wondering what you are concerned about more? Being sued if you are the owner or being able to take back the lots if your buyer does not pay as agreed. Which is more important to you?
My main concern is the liability side of things. I have too much to lose personally over some 2k piece of land/deal. I understand the LLC provides a shield, and as long as there is no proven negligence and such that buyers shouldn’t be able to “pierce the corporate veil”.
I am really just trying to find the best balance between liability and cost of repossession. I don’t think there are many options and also 100% of the other investors/companies out there who do what I am trying to do operate with CFD’s.
Someone on here mentioned deeding the property over in some form of trust deed or something, which makes it easier to take a property back AND completely eliminate any chance of liability. I essentially just want to be the bank in these transactions, nothing more.
“trust deed” is modern mtg option
In many states the mortgage form used is Deed-of- Trust which then can be foreclosed non-judicially…but legal fees are so high that many DIYers are using RE contracts which can provide much quicker and cheaper repo than a DOTk