Posted by Dee-Texas on February 19, 2002 at 13:28:21:
If this is a blue collar house this is my answer.
I wouldn’t go down on rent, I would go down on option money…the reason…the option fee you can split, tell them $1450 now and $25 extra a month until it’s paid (make a seperate promissory note with interest). If you go down on rent then why is it any different than rental property? You’re paying taxes and insurance…they couldn’t buy for that, PLUS most that come to me can’t buy from a conventional lender anyway. If you took $100 less per month on a L/O you would lose $1,200 per year. On a two year L/O you would lose $2400.00. Make it easier for them to get in and then they can work to please you.
Most don’t have that amount (a large option fee) and won’t even neogiate with you…they don’t know how…so they pass.
OH…big tip…don’t start rent credits until ALL of the option money is paid. OR only give them $50.00 rent credit it’s still a lot better than they would get with a normal amoritized loan. Usually on a $40K loan only about $20 goes to principal for the first 5 years.
Anyway, my two cents.