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How To Put Responsibility Of Home Repairs On The Tenant And Not On The Investor

 

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How To Put Responsibility Of Home Repairs On The Tenant And Not On The Investor

Joe: Hey, it’s Joe Crump. Got another question here that was sent in to me. This is from Xsan Xiang. He say, “Dear Joe. My question is what language can we use in the lease option or rent to own agreement to place the responsibility for maintenance and repairs on the tenant buyer rather than on the owner or the investor?”

Joe: Now, that’s what we’ve done in the documents that we’ve got, so if you use my documents it’s already going to be in there. We put the responsibility completely on the lease option buyer’s shoulders and in the section that would normally talk about who does what, it just says that the seller is, or the buyer is buying it “as is” condition, all repairs to be, and maintenance to be done by the buyer. So that’s the basic verbiage. But it’s more detailed than that, and I can’t really give it to you all here. But you can get it, you can get that document by getting the Automarketer, you can get it, I have a book on Amazon called “Automated Real Estate Investing” and it’s go the lease option documents in it. You can get that. Of course it’s in my mentor program and some of the other programs that I’ve got as well. So, that probably cheapest way is to get it from the Amazon book, it’s like, $3.00. But, or you can create your own. But you don’t have to take responsibility for the work that needs to be done.

Joe: Now, with that said, even though we put all the weight on the shoulders of the buyers to do this work, I also tell the seller this may not be enforceable in court. The goal is not to ever to go to court. So, if, let’s say the furnace goes out and it’s the middle of the winter, and the buyer doesn’t have enough money to put a new furnace in there. That seller better get in there and put a furnace in there so his pipes don’t freeze and also if that buyer, you know, you decide to, I’m going to evict you because you can’t put this furnace in, and he goes to the judge, the judge is going to say, “No, you’re a landlord. You need to put that furnace in there. You need to give him a habitable property.”

Joe: So that property has to be habitable. And if those issue that need to be done are habitability issues, then yes, you’d be required to do them by a judge if it ever got that far. So what you want to do is, since it is the agreement between you and that buyer that he take care of it, that he treat it like his house, and we even say, look, treat me like Bank of America. You know, if your toilet stops up, you know, you don’t call Bank of America, if you’ve got a mortgage on the property. It’s your property, you take care of it, your responsibility. And usually the buyers are comfortable with that type of thing. That’s what they want. They want home ownership. So, they’ll usually do that kind of thing.

Joe: But if it does come to a situation where you’ve got a big expense that needs to be done and the buyer doesn’t have the money to do it, the seller would probably want to come in at that point and say, look, we’ll put the furnace in, it’s going to cost $1,500. Why don’t you pay us $200 a month over the next, you know, six or seven months and that way you’ll take care of it. Seven, eight months, whatever, you’ll take care of it. And that’s usually what happens and that’s usually what they agree upon.

Joe: If there’s a dispute and they won’t do it, and they decide to take it to court, the landlord will probably lose and will need to put that unit into the building.

Joe: All right. I hope that answers the question.

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