Lease/Option "Guarantee?" - Posted by Mark K

Posted by Matt B on February 14, 2001 at 08:55:39:

First of all, give them the FAQ list that I wrote up at using your name or your business’ name in place of PA Home Solutions. Then assure the sellers that it is in your best interest that the tenant/buyer excercise their option because you make your money by selling the house.

I would also use this concern as an opportunity to sign the house up for an extended period. I always write up my agreements for one period of 12 months, automatically renewable (at my option) for however many more periods of 12 months I can get. (I usually just write in 3 and nobody seems to mind.) What you could do is ask how long they would need the lease option to be for in order to make them comfortable.

If the seller is unsure how long they want the lease option to be, simply write it up as I wrote above, then tell them that if the worst case scenario happens and you are unable to get a tenant/buyer to excercise their option in that amount of time, you would be more than happy to renegotiate the contract and extend it since you wouldn’t want to just give up the equity that you built into the place.

Hope that helps you out.

Lease/Option “Guarantee?” - Posted by Mark K

Posted by Mark K on February 14, 2001 at 06:38:33:

I am looking for recommendations on how to calm potential sellers they will not get stuck at the end of our L/O with 2 house payments. I am new to L/O’s and have had several discussions with potential sellers where they want some form of “guarantee” I will buy their house.

If I buy their house on a L/O, they are concerned I will not end up excercising my option and purchase the house at the end of my option period - thus “sticking” them with 2 payments.

I am hoping to come up with something that doesn’t require me putting up a large some of money on the front-end. Any suggestions?