I don’t it really matters that much whether you live in the sticks or if you live in a metro area. L/O works with tenant/buyers who are unable to find financing with a lender due to credit problems. a Lease option give them the opportunity to get into a home without having to deal with a bank or mortgage lender/broker. In a way you provide seller financing in a creative way that nets you a profit in 1-2 yrs. Provided the tenant/buyer exercises their option. if not, you have the down payment money as well as the small cash flow that may have been used as rent credits.
Now is a good time to get into the L/O business. Rate are low which would allow you to get property at good rates. As the economy recovers and rates rise. Many potential homeowners who weren’t able to get a mortgage will have to go back to renting. There has also been a growing number of forclosures in this country so homeowners who are defaulting will need a place to live. L/O maybe a good option. (Albeit, it would be just a lease because if they couldn’t afford to keep their first house, what makes you think they’ll pay you on time?)
Does Purchase Option Investing Work ? - Posted by RE_Newbee
Posted by RE_Newbee on October 13, 2003 at 09:58:06:
I was wondering if anyone using Purchase Option Investing might share their success or failure.
I was reading about some of the techniques used by Peter Conti and David Finkel, in particular. Just wondering if anyone could share if they have had some success using these strategies. I also do not live in a large metro area - can this stuff work out in “the sticks”?
Thanks in advance.
Re: Does Purchase Option Investing Work ? - Posted by David B
Posted by David B on October 13, 2003 at 18:49:03:
RE,
I’m wondering the same thing. I just read the Purchase Option Investing book, too. It makes a lot of sense to me, the major problem seems to be finding a seller who basically is okay with not getting much cash today ($1 or $2 K), and is betting that you will buy it (or sell it to your tenant buyer) in 5 or 6 years–which seems like a long time to me. I guess you’ve got to find a motivated seller who is so under the gun that he just wants to get out of the monthly and so you’re helping him out of a bad jam. My wife and I are thinking of doing this and it seems like a numbers game where you’ve got to really work the phones or the streets to come up with sellers that are really MOTIVATED.