Posted by ScottS on June 15, 2000 at 15:27:30:
Unless he’s gonna buy and hold he’s going to need to get rid of the Section 8 tenants because they most likley won’t be purchasing anytime soon.
Which if he was going to buy and hold the Land Contract the lady first spoke of would be the way I would go. Matter of fact, if SHE mentioned the land contract that’s the way I would push the conversations.
You get more benifits when you buy on land contract. All other terms being equal that is.
Scott
Holy lease options batman! - Posted by Bob Selby
Posted by Bob Selby on June 14, 2000 at 19:39:45:
Looks like I may have fell headfist into my first lease option deals. Went through the paper today and came across a small ad for several homes. No details were given, it just specefied that the person had several properties on the east and west side of town to sell.
I called in and discovered what may indeed be the perfect L/O scenario. Apparently this woman owns 8 homes scattered around town and has been into RE investing for several years. All of the properties currently have tenants and she is just tired of the headaches and wants to unload them. Chasing back rent is putting her behind on her mortgages and rather than further damage her credit she just wants to sell out and pay off her loans.
She mentioned that she might even be interested in doing a L/C package deal, and thats when the light went on and I started discussing L/O with her. She was very interested in the concept and wanted to meet to discuss it further once I have had an opportunity to look at the homes, which I plan to do tomorrow.
Now, the property may very well all be dumps and her asking prices insane, that I will know after I get a chance to go through them and pull some comps. If they do indeed check out, I have some issues to cover pretty quickly since these will be my first L/O deals.
#1. I think I am definately going to need an attorney with L/O experience. Can anyone reccomend one in the Detroit area?
#2. How is the best way to handle the payments to be sure that things like her mortgage, insurance and taxes get paid. I’d hate to just give her a check every month on good faith that she is paying everything as she should.
#3. If indeed the properties look good and comp well in relation to the asking price, what first steps do I need to take to get the ball rolling on these deals?
#4 The current tenants all are paying a small to large portion of their rent via Section 8 assitance. If the current tenants show interest in a L/O, will section 8 recognize this and continue to pay? If not, isnt the best thing to do evict them ASAP in order to get a tenant/buyer in there?
#5 I am very new to L/O in general and havent taken the opportunity to order any courses yet on it which I presume would have the neccesary forms and paperwork included. Are there any sources out there that make these documents available for a reasonable fee?
Thanks in advance for your assistance!
Re: Holy lease options batman! - Posted by Scott SC
Posted by Scott SC on June 15, 2000 at 12:53:19:
I don’t agree with Steve that you should “kick out” the section 8 tennants. Sec. 8 means you get most of your money from the government. Unless your seller has these properties way over mortgaged, you may want to look at section 8’s as an advantage not a disadvantage.
I have a buddy who has several sec. 8 approved houses and his check from the gov’t is never late!
Do a little more research, find out why she’s behind in payments on the section 8’s.
Re: Holy lease options batman! - Posted by Steve(NC)
Posted by Steve(NC) on June 15, 2000 at 10:25:32:
My thoughts:
#1 Pick up the phone book…
#2 Set up an escrow account…the tenant pays to XYZ escrow and they send the payments to the mortgage companies etc…and excess check to you.
#3 Find out EXACTLY how much she owes on back payments…
Find out the comps…
FInd out here equity in these properties…if you solve this problem for her you should be able to get paid nicely for it.
Start talking payments with her…
#4 Section 8? It is not allow to do a rent to own in this area with section 8…
Evict them? Sticky one there.
#5 Spend the money and get a FEW Courses…learn all you can.
Try your best on this deal…you will learn a lot whether you get it or not. Keep trying to solve her problem.
Hope this helps.
Steve(NC)