Lease Purchase gone bad.
It has happened again. A Lease Purchase in TX had a tenant whose home burned. The cause of the fire is suspected to be a result of the tenant’s negligence.
They had too missconceptions:
- They did not need insurance. The reality is the lease purchaser MUST have insurance to hedge themselves from losses caused by negligence or “acts of god”. In this case, the insurance company and the owner are now sueing the tenant for accidentally burning the home. The Lease purchaser is having to file bankruptcy to rid themselves of this “debt”. Even if the fire was NOT the tenant’s fault, the financial drain has continued to position the ability to close more and more out of reach.
- The Lease Purchaser believed that the landlord’s insurance protected them. This can not be further from the truth. Even in a sitiuation where the home is being purchased with a “contract for deed” insurance that the landlord owns will not provide coverage for the tenant. (note: contract for deed sales are insured differently based on State.)
Be insured! It is the EASIEST way to position yourself to close even if you experience a major losses.
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