Leases, Due on Sale and Rent Free Neighborhoods

MI Broker Summit- Coffee with Counsel

Notes from listening to Attorney Greg McClelland, Brian Westrin and Kelly Myers

Leases seem to be the newest why to scam in real estate. Scammers will give a consumer a lease with option to purchase never really intending to follow through on the sale. After the consumer has "leased" the property for a couple of years, the scammer causes a "Trigger Clause" to go into effect so the consumer loses the home and the option. Consumer loses all money invested.

Remember when figuring a lease payment to include the cost of Non Principle Residence Exemption.

Lenders are activating the "Due on Sale" clause even if a property is leased. Yes, they can. It is possible to get permission from the bank in writing so the clause will not be activated. The bank approval can happen with a land contract also.

Rent Free Neighborhoods are popping up! 2/3s of a neighborhood can go to the local authority to request their neighborhood be declared a "Rent Free Zone". This is happening now. There is a case against this going up in front of the Supreme Court.