Hi all,
One of the strategies that we am looking at is the "Rent Option". This is where we rent our IP out to our tenant over the next 5 years while giving them an Option to purchase it at the end of that period. This "Option" will be attached to a Purchase Contract that will be signed by all of us in 5 years time. We will both hold a copy of the "Option" and the Purchase Contract.
A friend reckons the Banks don't like this type of deal and mentioned that their mortgage documents also says that we have to let them know if anyone else has an interest in our properties. Is this correct?
We realize that the Bank would soon find out about the deal if the prospective purchaser (our Rent/ Option tenant) put a Caveat on the property to protect their interests.
Cheers,
Bernard
One of the strategies that we am looking at is the "Rent Option". This is where we rent our IP out to our tenant over the next 5 years while giving them an Option to purchase it at the end of that period. This "Option" will be attached to a Purchase Contract that will be signed by all of us in 5 years time. We will both hold a copy of the "Option" and the Purchase Contract.
A friend reckons the Banks don't like this type of deal and mentioned that their mortgage documents also says that we have to let them know if anyone else has an interest in our properties. Is this correct?
We realize that the Bank would soon find out about the deal if the prospective purchaser (our Rent/ Option tenant) put a Caveat on the property to protect their interests.
Cheers,
Bernard