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Old 03-11-2008, 05:11 PM
 
2 posts, read 7,312 times
Reputation: 11
Question Funding for Property on Indian Lease Land

Hello:

Does anyone know of a lender(s) that fund loans on homes/condos that are built on Indian Lease Land.

Thanks very much.

Marsha F
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Old 03-12-2008, 01:50 AM
 
Location: Desert Southwest
228 posts, read 743,121 times
Reputation: 357
Marsha:

Since you're talking Indian land lease property, though you don't say it, I am guessing that you bought something in Palm Springs or very close by. My first response is, I'm really sorry that you did it. I always urge people to avoid land lease properties like the plague.

As to your question; are you just asking in general or are you having difficulty finding a lender for your purchase? I ask because there usually is no problem obtaining such funding on lease land property. The only time I have heard of such an instance is when the lease has run below the 30 year mark. Is that the case with the land your property sits on?

In any event, if you do not know the terms of the lease governing where you are buying, find out as quickly as possible. Land leases can be a nightmare when it comes time to re-negotiate them. Negotiations tend to drag out years, rather then months or weeks. If the party responsible for collecting your land lease fee has not been keeping up with the cost of living increases in the fee, you may get a notice one day that you owe an extra few hundred dollars because of it.

If you are having a problem finding funding, and you are buying in Palm Springs itself or the area, my only suggestion as to a possible source would be Canyon National Bank. The bank is owned by the Indians, so I cannot imagine that they wouldn't loan money for a property sitting on land owned by one of their tribe members.

Should you have any questions regarding land leases or HOA's, please feel free to post them and I will do my best to answer them.
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Old 03-12-2008, 11:30 AM
 
2 posts, read 7,312 times
Reputation: 11
Talking Thank you

Hi there:

No, I am not purchasing the property. I was asked by a real estate friend and since i had never approached the funding aspect of that type of property, and he asked me (I am a loan officer) to find a lender for one of his clients.

I have also read some of your posts on Indian Lease Land and I am taking to heart the issues of the transactions. Thank you for helping to educate me.

So, to confirm...you think that a loan would be possible with most lenders? I will call a few to confirm myself. And, if i get stuck, I'll call the bank you mentioned.

You are an angel.

Best regards,

Marsha
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Old 03-13-2008, 03:48 AM
 
11 posts, read 62,654 times
Reputation: 16
Marsha,

People finance homes on Indian-leased land all the time in Palm Springs. Local branches of national banks work just fine. I used Wells Fargo Mortgage in Palm Desert; the loan officer there is Nancy Stellings and she was very helpful. Your realtor will have his or her own recommendations. The same is true for escrow companies; the Indians must approve transfers of real property that occur on their land, and a good escrow company understands how these transactions work.

While I've owned property on both fee simple and leased land, and obviously not having a land lease is preferable, if you like the real estate I wouldn't let the existence of a lease push you away. On the other hand you may ask your realtor whether there is a similar property nearby that isn't lease-encumbered. Due to the checkerboard pattern of Indian ownership, chances are there will be a fee simple block close at hand.
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Old 03-13-2008, 03:58 AM
 
Location: Desert Southwest
228 posts, read 743,121 times
Reputation: 357
Marsha:

To the best of my knowledge, other than with the specific situation that I mentioned, I do not believe that there should be a problem in obtaining funding through a regular lender.

Also, many thanks for your comments. I'm glad you found my posts informative.
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Old 04-15-2012, 02:26 PM
 
2 posts, read 3,547 times
Reputation: 10
Default I'm cash buyer willing to take over a 15 year lease balance

Hi,

I never thought I'd buy a home on leased land. But at 67 I realize a ~20 year lease would me get well into dotage. So how do I find properties where: I can assume the current lease (with its presumably low payment) At a sales price reflecting that the Indians are playing hardball on lease renegotiations. Banks will not finance, as I can pay all cash.

Obviously the Indians have CPAs who are advising them in lease renegotiations. So is there an Excel formula where you can plug in the lease's variables to arrive at a cash price equivalent of a fee simple deal. E.g., how much is a $500K fee simple-equivalent home (less lot value) worth if there are 20 years remaining on the lease at $400/mo. + cost of living adjustments and the lessor will not renegotiate?

More Qs:

When a leased home is sold, are there acceleration clauses with penalties and/or lessor approvals?

Can I circumvent a lease's hairy arm clauses by purchasing a long term lease from the seller instead of an outright sale?

I am a rookie in Indian leases but a fast learner who's looking to make a move. Help!

Last edited by David Aguilar; 04-21-2012 at 08:40 AM.. Reason: removed formatting
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Old 11-06-2012, 10:59 AM
 
1 posts, read 999 times
Reputation: 10
Eric Bennett does. He's very knowledgeable about this kind of stuff. You can reach him at 760-861-5626.
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