Posted by curt on April 18, 2000 at 10:42:30:
Explain more about straight options. Thanx
Anyone have success with straight Options? - Posted by Charity
Posted by Charity on April 16, 2000 at 20:26:24:
I am referring not to L/O but just straight options like Ron LeGrand teaches. There are quite a few higher priced homes that I run into that expire and won’t sell. I was thinking this would be a low risk way for me to start. Anyone do these?
Charity
Re: Anyone have success with straight Options? Yes! - Posted by Eric C
Posted by Eric C on April 20, 2000 at 01:22:51:
Hi -
I’ve used straight options to control property for many years. For the most part, these properties have been special use, agricultural, or commercial rather than residential.
I’ve used “straight” options to gain access,“lock up” and utilize farms and ranches in several states; they work extremely well.
I also use them in business. If you’ll do some research, you will find that the “big boys” use them all the time.
Yours,
Eric C
PS - you might have better luck if you didn’t call them options – try using the term “last look provision”. The language you use is often critical to your success.
B.L. Renfrow Has! Maybe he’ll see this … - Posted by messerb
Posted by messerb on April 18, 2000 at 11:43:27:
Charity,
I hope Brian Renfrow sees this, since he has done these before.
We’ve gone through LeGrand’s blue course and ALMOST did a straight option. The numbers were very compelling, but the seller got cold feet. (They did not HAVE to sell the home, and they were still living in it. Not the ideal scenario for doing an option.)
We have two option prospects that we have a much higher likelihood of getting the agreement signed. Neither will have an option consideration of more then $10.
Good luck!
Monique
Re: Anyone have success with straight Options? - Posted by Mr. Ed (ATL)
Posted by Mr. Ed (ATL) on April 17, 2000 at 22:42:35:
In theory, pure options are a no lose situation for the Optionee. However, my experience has been that unless you accompany your option offer with some very persuasive consideration (in most cases a respectable amount of cash), your offer will be refused. Why should a seller give you the exclusive right to buy his/her property, thereby isolating himself from other prospects, if you cannot give him anything substantive in return, save a promise you “might” buy at some nebulous point in the future? I would say that this technique would rarely work for anyone except the most motivated (desperate)of sellers.
Perhaps others have had more success.
Ed
long escrow purchase agreement - Posted by lesliel
Posted by lesliel on April 23, 2000 at 04:29:46:
i would like to know more about how you use options. i do many each year but not many straight options.
there a lots of ranches and hunting clubs in my area. i would like to hear more about farm and ranch options.
it seems that liquidated damages in a purchase agreement are similar to option fees. a purchase agreement might be used like an option, with a penalty similar to an option fee. i would guess that if an option is hard to understand or hard to sell as a concept, possibly an offer and penalty might be more easily understood…
any input on this?
leslie
That should not be a problem according to… - Posted by Charity
Posted by Charity on April 18, 2000 at 07:48:31:
the way Ron LeGrand teaches it. You don’t have an exclusive option. The person can still try to sell themselves and list with an agent (as long as you are excluded).
Options 2 - Posted by Eric C
Posted by Eric C on April 26, 2000 at 17:48:45:
Hi Leslie -
Sorry to take so long to get back to you, but I’m still trying to get my taxes finished and get up to St. Louis for the Workshop.
If you can be more specific, I can probably give you a better answer.
You’re correct about the penalty clause (for damages). There is probably a slightly higher risk of a lawsuit for specific performance, but in my opinion, it’s only a slightly higher risk. There are instances where folks holding options were sued for specific performance.
Options work well with any situation that is highly illiquid – farms and ranches definitely fit that category.
Most of the time, I don’t use cash for the “consideration” ; instead I use something that has a high perceived value – something they want. In this way, options can also be used to solve problems.
My point about the language is just that - a point about the language you use. People often have objections to the (buzz)words you use and they will express those objections in unusual (sometimes bizarre)ways. They will turn down a deal that will solve their problem, or refuse the profit they’ve been desparately seeking, or they might just stall you.
Often the reason is a lack of understanding. They don’t understand your reasons, your terminology, or the range of possible outcomes for themselves.
Rather than ask you, what does this term “option” mean and how does it affect me under this contract, they will just walk away. Remember, the unknown is very scary to most people.
In any case, if you’re interested, let me know and after the workshop I can get you some specifics, OK?
Good luck,
Eric C
Re: That should not be a problem according to… - Posted by Mr. Ed (ATL)
Posted by Mr. Ed (ATL) on April 18, 2000 at 18:33:46:
What good is your option if it is not exclusive?
EBL