immediate help on L/O deal!!!!! - Posted by spider

Posted by Steve(NC) on February 01, 2001 at 18:30:04:

TRY not to confuse him too much.

Tell him that in order to buy it at some time that you would first need to rent it. You rent it from him with the right to sublet it to a third party.
You then hammer out:
1- length of the contract…usually 3-5 years at least.
2- Monthly payment that you will give him
3- purchase price (option)
There are other details but those are the major things to deal with.
You then advertise it as a rent to own…and you charge more monthly, more for a purchase price,a one year contract, and non-refundable option money.

Terms you have with seller
$700 month rent (with X rent credited towards purchase)
3 year l/o
$90,000 option/strike price

Terms you give to your tenant/buyer:
$800 month ($100 monthly cash flow to you)
1 year l/o
$100,000 purchase price
$3000 option money
After a LOT of other things are dealt with…you will get:
$100 month
$3000 now
$10,000 minus the $3000 option money = $7000 minus any rent credits…when they buy.

There are a lot of other minor details that would be worked out but that is the basics of it and how it works.

You need the right to sublet and those 3 terms hammer out…and you should be able to make some cash.

Hope this helps.

Steve (NC)

immediate help on L/O deal!!! - Posted by spider

Posted by spider on February 01, 2001 at 15:39:12:

Okay I took you guys advice on birddogging and I took the
liberty and went out looking for myself.I would only birddog if the property was in a bad neighborhood.Ok heres the deal, a distress owner answer my AD “I WILL BUY YOUR PROPERTY IF YOU GIVE ME A LEASE WITH AN OPTION”(thanks Lori).He ask how the lease option works I explain it the best way I could.I told him it was like rent to own except a portion of the rent would be credited toward the principal.He ask if he rent to own from another buyer would I be able to rent to own from him.Well my thinking was if I were to sublet the home I wouldn’t be able to sublet it from him. I don’t think you can double sublet. How can I structure this deal in a way that would be best for the both of us.Thanks