This article will address two unresolved issues surrounding the WA transaction which result from the inherent flexibility available for negotiating financing terms in the absence of an institutional lender. Part I discusses the circumstances warranting exclusion of the WA loan from the purchaser's depreciable basis. Part II addresses whether, and when, a due-on-sale clause in the senior mortgage should negate the possibility of utilizing WA financing.
Sanford M. Guerin,
Selected Problems in Wrap-Around Financing: Suggested Approaches to Due-on-Sale Clauses and Purchaser's Depreciable Basis,
U. Mich. J. L. Reform
Available at: https://repository.law.umich.edu/mjlr/vol14/iss3/3