Re: Please advise! - Posted by Charles Parrish
Posted by Charles Parrish on March 09, 2006 at 23:27:30:
You can not pull money from this deal since you do not have legal ownership; you only have an option to purchase.
Your profit margin is a little thin, but you could make it better.
I would suggest you engineer the contract where your seller will credit you back $100.00 month or more during the option period; the seller?s incentive is that you will pay all of maintenance, pay the increase in taxes and insurance during your lease and that you will make all payments as agreed.
Over the 5 years you could have a credit of $6,000 or more plus the principal reduction and any positive rent payments and appreciation.
When buying, I suggest have your option and lease in one document. Make sure you have the deed held in escrow. In five years, you may not be able to find the seller or he may change his mind. You will want to know where that deed is and how to get it recorded. Protect yourself.
That?s my opinion.