Investment

Why make a sale to repurchase?

Investment
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A short sale is a legal term that refers to an agreement concluded between an investor and an owner of a property. The latter will have the opportunity to buy it back after having paid all his debts. And he shall refund to the buyer the price agreed in the contract of sale. It is an effective solution to avoid foreclosure. It is a contract that is still little-known and risky, but is useful in some situations.

The reasons of making a sale has a redemption right

Many homeowners choose to make a sale was redemption for many reasons. The first is that they have a debt to pay and that the banks will make them more confidence and refuse to give them any loan. They are therefore in a situation of debt with the inability to pay bills. In this case, they decide to sell their property to an investor and buy it back after a period of 5 years. The advantage of the sale àréméré is that the owner and his family can still live in the house.

Then, another reason to make a sale àréméré as it is to avoid the threat of a mortgage or judicial foreclosure. Finally, in case of outstanding payments, it is automatically added to the National File of Payment Incidents, or FNIP. Make a sale àréméré can resolve this situation.

The steps of the sale to repurchase

In a sale with a redemption right, it must pass through a few essential steps including the sale, stabilization, and redemption. To pass each stage, it is recommended to make use of a notary. In the premièreétape, the seller assigns its property to an investor and he / she must sign a contract of sale with a redemption right with it and this in front of a notary. It is important to know that there are some conditions that must be included in this contract. We can mention the selling price is generally set at between 50% and 70% of the actual value of the property. Then, the period to redeem the property is of 6 months to 5 years. The investor who decides to buy the property will have a margin in earnings that he can recover at the time of redemption.

Then, the deuxièmeétape is the stabilization of the situation. After receiving the money, the owner paid off his debts and place a deposit guaranteed to the notary office to be used at time of purchase. You should know that after the sale, the owner becomes a tenant in its housing. The investor has no right to evict him or sell the property to someone else during the period of sale to repurchase.

Finally, in the dernièreétape, the owner may redeem his property once he has the necessary money. Here, a new deed of sale must be signed between the two parties. In the case where the owner does not redeem the property after the agreed period, the investor will be the new owner.

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