1) Contract for deed or land contract: The boomerang buyer would pay the owner a regular payment, slowly paying off the contract. The landowner holds the title to the house until it is paid in full. However, the buyer would hold an equitable title, which gives them most every right of ownership of the house. This may be a good option for new, or boomerang homeowners because it gives them a chance to own a home without traditional financing. The boomerang buyers will also be able to deduct the interest, and property taxes on their income taxes.
2) Rent-to-own or lease option: The boomerang buyer would pay rent for a house, and have the option to buy it for a set …show more content…
If buyers aren’t careful, they may pay higher rent and/or a higher purchase price. Another example is found in Texas. A law was passed which stated that the owner of the property deed has to formally foreclose on the folks who are in the rent-to-own option agreement. By passing that law, the skilled investors do what is called a contract for beneficial interest or virtual option, which is a form of trust that falls under the UCC, not real estate law. In layman 's terms, it’s very similar to contract for the deed, but it lies in a trust instead. The owner turns the house from real to personal property by putting it into a trust, and then the seller doesn’t have to do a