L/O to be outlawed in Texas? SB629

[NoMoneyDown]

I heard on another REI message board that the Texas Senate has a bill that may outlaw lease/options in the state.  Bill Bronchick posted in another group the following:

Texans, are you aware of Senate Bill 629 that just passed a committee hearing favorably and is off for a vote in the TX senate?

http://www.capitol.state.tx.us/tlo/79R/bil...xt/SB00629S.HTM

This law, if passed, will effectively OUTLAW lease/options in Texas.

Basically, it makes a lease/option an "executory contract", which is essentially a land contract. You are likely aware that land contracts require a lot of disclosures and annual reporting requirements.

Also, it further states that ALL EXECUTORY CONTRACTS (lease/options, land contracts) require the seller to have title. That means no sandwich lease/options, no selling a property on lease/opt or land contract that you bought on land contract.

AND, the kicker... you cannot sell a property on a land contract or lease/option if you have underlying financing! So, in effect, the only time you can sell on land contract or lease/option is if you have title FREE AND CLEAR!!

The only means of owner financing left in the state of TX will be:

1. Selling subject an existing loan and taking a wrap note (aka "All Inclusive Trust Deed" or "AITD")

2. Letting the buyer assume your note and take back a second

PLEASE, GET YOUR MEMBERS TOGETHER TO RALLY AGAINST AND KILL THIS BILL BEFORE IT KILLS YOUR BUSINESS!!

Bill Bronchick
Legalwiz.com

[TexHanlon]

This is terrible.

This is really going to hurt folks heading for foreclosure not just us investors.