"...that you are not related to or a business associate of the seller and that there is no hidden agreements, and that the buyers do NOT intend for the seller to remain in the home as a tenant or to regain ownership at any time after the consummation of this sale ... under penalty of perjury .... and understand that it is a Federal Crime ... to knowingly or willingly make false statements...... punishable by fine or imprisonment."
That said I know that some people have said that they have done this (investors rented back to the seller that is). I am not sure if their lender allowed it or not, but most of the ones that we have been involved with have stated the above in the affidavit of an arm's length transaction. That form comes with the approval of the short sale. It is always best to check with the seller's lender, and your attorney can help advise you.
Ron & Brenda Cunningham
West USA Realty
*** Recognized in the Phoenix Business Journal as "One of the Top 50 Realtors in the Valley" ***
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Why don't we find you an investment home for the tenants you have? Nothing wrong with purchasing in a down market and what you choose to do in the future is then completely up to the parties.
Lots of options to consider while the value of property is low.
Banks do audits on short sales and this could become a major legal and financial problem for you and your friend.
Hope this helps,
Beachfront Realty, Inc.
Jeffrey Austin, ABR, CRS, GRI
REAL ESTATE HOMES, LLC
Has your friend listed their home yet? If not have them give me a call. If they end up listing with me then I will pay for your initial consultation with an experienced real estate attorney. It is important that they know their rights. Check out my site at http://www.PinalCountyShortSales.com today.
Your best bet would be to have a lawyer review during inslection period before closing to make sure you can do what you want to do.