Posted by FJW on March 04, 1999 at 17:14:10:
for this type of input.
lease option? - Posted by mark
Posted by mark on March 04, 1999 at 10:31:06:
I haven’t done anything like this, so advice would
be appreciated. I have a rental with tenants who have
been there over a year. They came to me and asked if
I was interested in selling the house to them. They
don’t have terrible credit, but say they can’t
qualify for a loan right now and want me to owner
finance. I read several posts about lease options
and it seems to be the way to go on this. What is
considered a fair option period, lease payments,
etc. The house has a FMV of about 70k and I owe
47K. They pay 595.00 in rent. I was thinking of asking
full price, 5k down and 700/month with 105.00 per month
credited to price of house; option expriation in 36months
at a balance of 61,220. I believe they will be able to
get a mortgage then if they stay clean or I wouldn’t
consider the deal at all. Are these fair terms for both
parties?
For starters, read more and think about… - Posted by FJW
Posted by FJW on March 04, 1999 at 17:11:07:
buying one of the courses here. You need to assess your risk. Naturally, you want to minimize it as much as possible. I don’t want to tell you what I’d do, but rather ask you to think about what you are proposing.
Why don’t they qualify for a loan now? When will they, how and why will they and for how much? What other expenses do you want to have covered by the L/O? Do they take care of the place now? What can happen over three years? Think about a worst case scenario. Can they handle all the expenses and responsibilities if it were theirs now? What do you think will happen to property values in the future? If you’re willing to do some creative financing, do you think you should be compensated extra for it?
You’re on the right track, but think about the option period, all the expenses that they need to learn to take care of, and the purchase price some more. Definitely consider purchasing a course. There’s a lot more involved and you should have the proper documentation to cover all your bases. Check out the information & products here and also go to legalwiz.com.
FJW