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Do you think its a good idea to rent to own my house back from a landlord?

I'm about to lose my house for taxes and can't refinance because there is not enough equity in it, but it is a family home I want to save and a local landlord has offered to pay off my debts and taxes and in return, I will sign over the deed to the house to him and he will do a lease option where I rent to own for 3 years then get a mortgage to pay off the rest, thus saving the house and giving me time to get my credit rating improved. The problem is that I have heard really bad things about him doing this with people and then kicking them out of their house. I don't see how he can do this if it is done through a lawyer as he said it would and I have a seperate lawyer go over the contract. What do you think? Is it a good idea or not?

Public Comments

1. JMO, but I would not trust him. Once you sign the deed over to him, it's his. This is best left to a lawyer though. When you talk to your lawyer, express these concerns with him/her to see what recourse you'd have if the new owner tries to kick you out. Sounds like the guy is just trying to flip the house for a profit, but he could have more devious plans then that. Talk to a lawyer and make sure it's all explained in plain English before you sign your family home over to this guy.
2. Basic landlord-tenant code is like this: as long as you fulfill the terms of the contract, there should be no reason to worry about the landlord. At least not one you can't defend in a court of law. Where you need to worry about bad landlords is in the request for repairs which, since this is your house, maybe is not a worry for you and two, what happens if you default on your lease-option. Remember this about leases, they are considered broken after the 4th of the month and you don't pay on time. It's customary for landlords to forgive this lateness through a late fee or even if let you slide, but it is by no means required that they extend the courtesy. You're late, you're in default. A contract worded a certain way could forfeit your option money which I'm sure you realize you will have to pay at the signing of the lease-option. Also, a contract worded a certain way might make a late payment or habitual late payments grounds for not having to sell you the house. It is probably not the case as many lease option landlords do it for the security of an "invested" tenant with incentive to pay on time for 3 years and a built-in sales price being a known quantity at contract signing time. That said, if he has a reputation, then you want to make sure the contract doesn't have any funny business written into it and also, you have to be sure you follow the terms of the agreement to the letter.
3. no. you've already given the reason never to do this. the minute you're late you lose your house. have you talked to the tax assessor to try and work out a payment plan? can you get the money as a cash advance from a credit card? better to be late on a card then lose the house.
4. If you have heard those rumors they are most likely true. People do this scam all the time. My friend signed her house over to one of her helpers so he could pay the taxes. He took the house. Everyone thought he was poor, but he was one of those fake poor people that hang around libral arts collages (trustafarian). He legally stole her house. They were friends. This landlord sounds even more distant than that. Sounds like your gut says "no". Go with your Gut.