Lease Option Pitfall Number 2 not doing a proper title search.
In real estate investing without checking title you’re in trouble, it’s really stupid not to check the title.
I’ll give you an example, that even if you check the title you could have a problem.
I had a student that had a house that was for sale and I believe it was an expired listing so seller tried to sell it with an agent and it didn’t work out.
So my student found a nice house with an older man trying to sell the house. There were no liens against the house and that was fine, it’s got to do with who owned the house.
The man was the only person on title but got divorced, and there was a loan against the house that both he and his wife were on the loan.
Divorce situations you’ve got to be really careful.
You got to read the divorce decree which my student did not do. The divorce decree said that within an ex number of months he needed to sell the house and split the profits of the net cell.
Divorce decrees are important in real estate. If the divorce was Final and there’s real estate involved the judge may have said to do certain things with the house regarding a house sale even if only one person is in it.
In fact he had to check with his wife to get permission to be able to do at lease with option on the house versus a regular sale.
So you can see even if you check the title and it can be no liens against the house you got to be cautious about divorce situations.
It takes experience to be good with real estate investing especially with terms deals like least with options or subject to or land contract purchases.
