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I own a townhouse, a land trust owns the land and leases back to me. Can I refinance to buy the land trust out?

Colorado Springs, CO |

I own a townhouse, worth 93k. A land trust owns the land , worth 20k, and leases back to me. I have owned for over 10 years. I want to refinance and buy the land trust out. They are willing to work with me. I have 17k equity in townhouse. I owe 63k on the mortgage. What is best route for me to accomplish this?
Also, I am closing on a new house and probably changing my occupancy so this townhouse would become a rental income. Townhouse would rent for easily over $800+ a month. I had good FHA appraisal etc. already. Any more tips? The numbers work well I think. How about HARP ? thanks so much!

Attorney Answers 3

Posted

This really isnt so much of a legal question as a financial one. If the trustee of the land trust has the power to sell or the beneficiary (the true owner) instructs the sale, there should be no legal impediment. The issue becomes whether a lender would go along with your financial position.

The general advice above does not constitute an attorney-client relationship: you haven't hired me or my firm or given me confidential information by posting on this public forum, and my answer on this public forum does not constitute attorney-client advice. IRS Circular 230 Disclosure: In order to comply with requirements imposed by the Internal Revenue Service, we inform you that any U.S. tax advice contained in this communication (including any attachments) is not intended to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein.

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Asker

Posted

thanks for the info - great to hear a direct and honest opinion!

Posted

I would sit down with a good attorney like Clifton Black in Colorado Springs and talk about the best way to accomplish your wants and needs in this situation. This is too fact-intensive and will be too difficult to answer on a forum like this. Best wishes

The information provided in this answer does not create an attorney-client relationship. If you are interested in his legal services, feel free to call Chris at (303) 409-7635 at his law office in the Denver Tech Center. All initial consultations are free of charge.

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Posted

Its nice to have money and hire great attorneys for all things... most of america does not have too much money or resources. I appreciate the fact you took time to answer. If I had alot of money I would just buy the land trust out. It would be nice for a helpful tip or direction... best wishes to you!

Christopher Daniel Leroi

Christopher Daniel Leroi

Posted

I understaand. That is why most attornwya will do slow pay or low pay arrangements and even free consultations. The image that attorneys all amke lots of money is a total myth and fiction. I have many teacher friends that make more money than I do.

Christopher Daniel Leroi

Christopher Daniel Leroi

Posted

Sorry about the spelling errors from my cell phone. What I was trying to get across is that many of our clients have as much if not more money than us as attorneys. The media's representation of attorneys as all being wealthy is fiction. I know dozens of excellent attorneys who are filing bankruptcy and living paycheck to paycheck. I also know that attorneys hire attorneys outside of their speciality to help them with their bankruptcies, divorces, etc. I do not like having to pay doctor and hospital fees (which put attorney fees to shame). However, I have to undergo a heart surgery next month and there is NO WAY on Earth that I am going to do it myself or trust the surgery to anyone but an expert in the field. I will be paying off those surgery bills probably for the next 5-6 years of my life on a payment plan with interest. However, that is simply life.

Posted

I agree with the comment above, the legal issues are pretty clear - yes you can do this. From there it is financial issue.

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