Question for investors who are also licensed..... - Posted by charity

Posted by eric on April 18, 2000 at 22:19:22:

huh? I’m confused. I am licensed, though inactive, and more of a dabbler than an investor. Nevertheless, I will hold myself out as being qualified to answer your question, because I am full of myself. Just kidding.

Agents are most definitely required to put deposits in escrow, if it’s someone else’s money, and they’re buying someone else’s house. But if I own the house, as an investor, then my being an agent is not relevant to that in a lease option situation, other than just disclosing the fact that I have a license.

If I don’t own the house, then it’s a sandwich lease - I am remarketing the property, but not as an agent - as an investor. My option (buyer’s side) enables me to market an equitable interest in the seller’s property - the same reason a non-licensee can market a house they don’t own, IF THEY HAVE A RECORDED OPTION CONTRACT. If the property is listed, then yes, it would be tough to do a sandwich lease, because the agent would have to take part of their commission in installments (good luck). I don’t know what Ron does, but I do know that a lot of times, investor require an option fee, for an option contract, and a security deposit, for a lease. This way, if the buyer chooses not to exercise the option, they still get some money back - making you look better in court, if they try to sue you for the option money back as well.

Question for investors who are also licensed… - Posted by charity

Posted by charity on April 18, 2000 at 17:08:29:

How do you handle doing Lease Options? I have been studying Ron LeGrand and I cannot figure out how an agent would make money. First, is he saying that he collects both earnest money AND a down payment or are they the same thing in his eyes?

Second, as I understand it, licensed agents are required to put earnest monies in an escrow account. If that’s the case, how would an agent make money if they could not access it for a year or so?

Let me know if I am missing something please.