Anyone ever had this problem? - Posted by Charity

import · April 21, 2018, 4:39pm

Posted by Rus Sims on January 28, 2001 at 21:57:38:

By “holding pattern” I mean that I can take a lease/option prospect that a bank has turned down for financing and put them into one of my lease/option homes. Then the tenant/buyer can cure whatever it was that resulted in the loan turn down (credit problems, ususally)and buy the house before the end of the option term…From a mortgage brokers standpoint, its great because although the loan can’t be written now, it almost certainly will be when the t/b emerges from the “holding pattern”.
Russ

import · April 22, 2018, 4:34am

Posted by Charity on January 25, 2001 at 10:12:42:

I have my first home under LO and I cannot find a TB! Here are the stats:

Home worth about $150K and that is what is owed.
Payments are $1016 on the 1st and the seller is going to pay the 2nd each month to me per our agrreement.

Terms I am offering TB: Payment of $1300 a month, $159,900 sales price and $3500 down. I am not getting anyone who is interested. They all want to drive by and then they never call again. I cannot afford to advertise anymore on this one and I am tapped out! Any ideas?

It’s a nice home- 3 yrs old, great area and n’hood.

Charity

import · April 22, 2018, 4:34am

Re: Anyone ever had this problem? - Posted by Steve-Atl

Posted by Steve-Atl on January 26, 2001 at 07:35:20:

Charity:

Its funny how things go sometime, but you will find a TB if you stay with it. Last year I had three houses on the market in January. Very few calls and I must admit I was getting worried. Then by Feb 15, all of them were gone.

The numbers of your deal are very similar to some of my deals. I don’t think there is a problem there. You just need to follow the advice of the others below and remember things will pick up. If not, you could just rent it to stop the bleeding.

Good luck!

import · April 22, 2018, 4:34am

Re: Anyone ever had this problem? - Posted by Bud Branstetter

Posted by Bud Branstetter on January 25, 2001 at 22:20:20:

What is FMV?

What is normal rent for a house like this?

import · April 22, 2018, 4:34am

Re: Anyone ever had this problem? - Posted by Jim IL

Posted by Jim IL on January 25, 2001 at 21:08:27:

Charity,
I agree with what was said in the other responses here.
The only thing I would add is to do some low cost marketing yourself as well.
Make some flyers up for the home, place them out front with some details on it. Then when people go see the home or drive by, they have the info needed to see if the deal works for them.
You can also place the flyers at local apartment complexes, grocery stores, laundrymats, and wherever a possible T/B’er may be.
I’d also place a sign in the yard of the home, if you have not already, as well as signs at the intersections leading to and from the home.
You can get cheap FSBO signs and add “Seller financing” or “Rent to own” to them with a large permanent marker.
I also know the market is slow here now, so it may be in your area as well.
In summer months I almost never hold a home for more than 2 weeks, tops.
Winter however is a lot slower, and this is why we negotiate different terms during this time.
You need to allow for holding the home longer when you buy, just in case.

good luck,
Jim IL

P.S. You may also offer something in return.
If you want to get the $3500, advertise that with the $3500 down, the buyer gets a free Microwave, or some other small household item.
Then, use there money to buy it for them.
Does the home have appliances in it now?
Take them out, and advertise the home for $3500 down, and FREE appliances.
Give the buyers some incentives and they may be more interested. Make them think they are getting a deal.

import · April 22, 2018, 4:34am

Yes… - Posted by B.L.Renfrow

Posted by B.L.Renfrow on January 25, 2001 at 20:37:47:

…more than once. When no one’s calling, it usually means there’s something wrong somewhere. It may be the price. Try advertising without mentioning the option consideration or the monthly payments. Make sure the price is in line with similar properties, or if not, you’ll have to be prepared to convince your potential T/Bers why you are offering them a “value added service” for which they should pay more.

Or perhaps there’s something about the property itself which is turning off potential T/Bers. Is it visually attractive from the curb? In good repair? What about the neighborhood?

Or maybe it’s your marketing. Try changing your ad. Sometimes just changing one or two words is all it takes to get the phone ringing.

Do you have signs on the property? I’ve gotten several deals just from signs on the lawn or in the windows.

Finally, make sure you’re advertising where your target prospects are most likely to see the ad. I do 100% of my print advertising in the Pennysaver and the local two-bit daily paper. No sense in spending lots more money to advertise in the larger regional daily, which will be seen by only a small percentage of my potential target audience.

Brian (NY)

import · April 22, 2018, 4:34am

Re: Anyone ever had this problem? - Posted by JohnBoy

Posted by JohnBoy on January 25, 2001 at 16:51:32:

One other thing. You stated that you will be paying on the first which is $1016 and the seller will pay the second each month per your agreement. Will the $1300 you charge your tenant/buyer cover the second should the seller ever stop paying on it? Otherwise you will have to come out of pocket for any difference to protect your tenant/buyer’s interest. If you are tapped out now and can’t afford to run any ads, the last thing you need is to get stuck with paying on a second that you can not afford. Also, will the seller be paying you the amount on the second each month where you will be sending the payment in or will you be stuck with trusting the seller to do this? If the seller will be sending the payment to the lender instead of you, did you at least get a number to the lender where you can call in each month to verify that the second is, in fact, getting paid on time each month? You don’t want to find out 6 months down the road that the seller had stopped making that payment and end up dealing with a foreclosure on your hands and having to come up with several thousand to bring the loan current. You need to make sure you can protect your tenant/buyer’s interest in the property or end up facing legal problems with them because the seller quit paying and you don’t have the funds to cover everything.

Make sure you cover your bases on this and allow room to where the rent you charge your tenant/buyer exceeds both payments on the first and second and still allows a small cash flow for you.

import · April 22, 2018, 4:34am

Re: Anyone ever had this problem? - Posted by Mark (SDCA)

Posted by Mark (SDCA) on January 25, 2001 at 14:13:32:

Russ has some good advice. Let me add one more. You say that people never call back. Are you calling THEM back?? I mean you are getting their name and number right?? You are fighting intertia here. It takes ENERGY for people to call you back. Call them back. It will flatter them, get them more interested. And if they legitimately ar enot interested, ask them why? Tell them you want to improve your marketing and press them to give you an honest evaluation of why they are not taking the house.

Mark

import · April 22, 2018, 4:34am

Re: Anyone ever had this problem? - Posted by Russ Sims

Posted by Russ Sims on January 25, 2001 at 11:16:53:

What does your ad say? The ads the get the best response for me typically begin “Rent to Own: any credit considered: zero down on this beautiful 3br/2ba home in North End. Move in NOW! 555*5555”

Now it may seem foolish to put “zero down” when I really don’t want to sell it that way, but in truth I may take zero down (but charge a $500 deposit) on a property I’ve been sitting on for a while…it just depends on the applicant. Zero down WILL get the phone to ringing, and then I can educate the prospect about how a small down payment will dramatically reduce the monthly rent (because if I go zero down the monthly will be maybe $200 higher). Then if a good prospect wants the home but has little down, I simply spread the payment out for them over several months. This produces great cash flow for at least 6 months and it really increases my pool of prospects.

Another thing you can try is to call or e-mail every mortgage broker and Realtor that you can…tell them you are looking for homebuyers who can’t yet qualify for financing…tell them that you’d like to put the buyer into a “holding pattern” until they become credit worthy, and that you’ll pay a referral fee for any prospect you place into the home…mortgage brokers really like this idea because they turn down folks for financing all the time. All they have to do is refer one of these turn downs to you, wait a year or two while the buyer is lease/optioning from you and working on credit, and then write the loan! Every mortgage person I’ve spoken to loves the idea. Worth a try. Good luck!

import · April 22, 2018, 4:34am

Re: Anyone ever had this problem? - Posted by Lisa Jones

Posted by Lisa Jones on January 27, 2001 at 22:48:25:

What is “holding pattern”?

Thanks