Posted by steph in tex on January 21, 2000 at 09:40:14:
Sudsidizing:
that’s when you go drink alot of beer (suds) when you can’t get a deal–
just kidding–
that was supposed to be suBsidizing— you guys know what i meant, and we all know i’m a TERRIBLE speller!
later!
Lease/Option Option - Posted by Paul
Posted by Paul on January 20, 2000 at 16:54:39:
Newbie question?
I have found several SFR properties that the owners are willing to L/O for minimal down. I am concerned that if I cannot find a new TB to sandwich to or Assign the L/O to within a certain period of time, that I will be stuck with the property?
How does the offer get worded to protect me in the event of this happenning, leaving me an out?
Re: Lease/Option Option - Posted by GregN
Posted by GregN on January 21, 2000 at 14:19:19:
Paul,
My .02: I don’t like to use the words ‘find a suitable tenant/buyer’ or even mention finding a t/b b/c I don’t want anyone thinking I’m selling real estate w/o a license.
I just put a couple of little things in the contract: ‘Payments don’t start until occupancy by tenant/buyer and/or assigns.’ and ‘Tenant/buyer has the right to cancel by xxx.’
That way payments don’t start until someone moves in and I can cancel if I don’t find someone within the first couple of weeks I’m marketing the place.
GregN
Re: Lease/Option Option - Posted by chris
Posted by chris on January 21, 2000 at 06:25:54:
You can find both a pro tenant/buyer form and a pro seller/landlord form at www.legalwiz.com. Note that the pro seller form has a seperate option form and a seperate lease form. You can read why this is desirable at:
http://www.creonline.com/articl72.htm
For the form examples go to:
http://www.legalwiz.com/forms.htm (the pro buyer/tenant is what you are looking for).
-Good luck, Chris
Re: Lease/Option Option - Posted by JohnWe (NoCA)
Posted by JohnWe (NoCA) on January 20, 2000 at 20:42:46:
That’s why you protect yourself on your lease payment. You should be taking leases for about 25% of the going rent in the area. The down doesn’t matter so much as the monthly payment.
You should be getting top dollar due to the option to buy, but if you’re nervous about renting the place, advertise your rent at 90% of the going rent. You should be okay.
My advice would be to stay away from weasel clauses like the one you’re looking for. I think you’ll scare away potential business that way. It’s better to absorb the risk with low lease payments, and option money on the front end.
Hope that helps.
Good luck.
Re: Lease/Option Option - Posted by Alice P. Best
Posted by Alice P. Best on January 20, 2000 at 18:15:06:
Let’s back up for a moment. You need to ask yourself this question:
Would I lease/option to someone who wanted to “see” if they could lease/option or lease/purchase my home while I still remained responsible for the payment AND the condition of the home? And, if it didn’t work out for them, “it all falls back in my lay”.
I don’t say this to be critical. I just think you would be hard pressed to find anyone who would do this.
Re: Lease/Option Option - Posted by Jim LaVerdi
Posted by Jim LaVerdi on January 20, 2000 at 17:50:59:
Paul;
If it were me I would use something like this:
On an attatched Addendum I would include the following;
Seller/Landlord agrees to allow Tenant/Buyer to show property to prospective Tenants prior to the closing date. The closing shall take place when an acceptable Tenant is found, but in no event prior to xx-xx-2000.
This clause should be more than enough to protect you in the event you can’t locate a sub-lessee.
I hope I was of some help to you, and in the future if you ever need advise CREOnline is the place to come for Real (real-estate) Answers.
Glad to help and Best of Luck!
Jim LaVerdi (Phoenix Arizona Investor)
Re: Gee Alice - Posted by chris
Posted by chris on January 22, 2000 at 02:28:57:
Kinda sounds like getting a realtor who convinces people to use their services but the home does not sell.
Realtors have not disappeared yet now have they? It’s all in how Paul sells the deal and how motivated the seller is.
-Chris
straight options—done it twice this week already - Posted by steph in tex
Posted by steph in tex on January 21, 2000 at 07:13:22:
it CAN be done–
I think it depends on your ability to negotiate.
people that don’t have many options, will take
the ONE that sounds like it’s the easiest. i beleive
it’s all in the presentation. if the deal looks like the seller is upside down, or has a payment so high i’m unlikely to find a buyer that can afford it in a certain area-- i get a straight option, and record a memorandom.
I even ask the sellers to consider “sudsidizing” the payment if we can get someone in that can’t pay the full amount. say the mort payment is 1200 a mon, but going rent is 1000— you’d be suprised how many people are willing to pay part of their payment. i can usually (well-so far always) get someone in to cover the payment, but the seller understands the situation, and fell like they are part of the process. They are always greatful for the help.
In my opinion–it’s all in how you present what you can do for the seller.
steph in tex
Re: Lease/Option Option - Posted by JPiper
Posted by JPiper on January 20, 2000 at 22:42:53:
Alice:
Actually I think it is possible to structure a deal with a contingency of finding a suitable tenant/buyer. It?s all a question of finding someone who is very motivated.
However, in a broader sense I agree with your post. I think that we should all have a good feel for our marketplaces, such that we know going in that the probability is VERY high that if the seller accepts your deal, that this deal is going to move very quickly because of the terms.
Either way, one thing is certain. There is going to be a broader list of sellers available without the above contingency. Trying to create a situation of absolutely no risk is going to narrow your buying window considerably?but not totally.
JPiper
What are you talking about? - Posted by Hal
Posted by Hal on January 20, 2000 at 20:21:20:
Alice.
The answer you supplied here is totally off the wall . Please read your books before posting such jibberjabber. And don’t start investing until you understand this a little better. Not being harsh but Lord Please! You need some tutoring dear
Hal