Q. A fellow investor I met recently told me that he doesn't use a purchase and sale agreement. He has his sellers put their property in a land trust and assign the beneficial interest to him. Although I'm just now learning about land trusts, this came as a real shock to me. I thought you were
supposed to execute a P&A first. He says he's been doing it this way for the past ten years in the State of Washington and before that in the State of
California. Could he be doing it this way in order to bypass the transfer tax, or something? I wanted to ask somebody about this before I went and did what he's doing because I have this funny feeling that what he's doing might not work out as well for me as it seems to be working out for him. Thanks in advance for your answer.
A. I cannot think of a reason why you would not use a P&S agreement. If you are using the Street Smart system and you should be, one of the first things we do is enter into agreement with the seller by having the parties sign a P&S agreement.
The steps to purchasing a property subject to the existing financing can be found in the Member Forum Downloads Section.