LEASE-OPTION

Well Rev. Dr. James you are in luck because I have heard your cry for help.First always be honest and up front. You should already be doing that you being a Rev.If I were you I would start with going to tax sales first! The reason for this is it is a cash-and- carry deal.And you might get a few properties with very little money.At the very least you will get your money with high interest rate! Hope I have help you! Good Luck!

Maybe getting your credit history and Fico Scores improved should be your first priority. There is no doubt that your credit standing will come up since in most transactions, especially if you have "no money down and are financing" your credit scores will be researched. You also say that you want to ask for concessions since the property is in Poor Condition--in view of your financial situation do you really want to get involved with a property that may have underlying problems you may not be aware of resulting in additional financial burden. I suggest investing in tax certificate sales which may provide a more stable investment and may help you become financially stable.

Just to get a feel of the market out there. Has anyone out there done a lease option on a property with a pre-foreclosure?. Like our example in this topic the Rev. has been through a foreclosure. I would like to ask you Rev. would you have considered seriously a lease option with someone if you were approached before the foreclosure? I think it would help all if someone had a real life example from the participants in this forum. We need someone who experienced the issue to give us their perspective and experience in the present market. Maybe some example in the last six months or so.

All of the questions you have asked are very good questions. Let the agent your working with know your financial situation so there aren't any surprises. The agents time is very valuable and at the same time they will appreciate the fact that even though you got knocked down you got back up! Use this house as practice. Try to get consessions if you can. What does it hurt to ask? What if they say no? Who cares! Just take action! Keep asking good questions and you will get a lease option deal done soon! Trust me there are a lot of flexible sellers in MI right now. Good luck!

So, in general, when is the best time for a Lease Option. We've done four of them within 50 miles of Seattle. One worked well, One failed miserably (but we took the house back, took 6 months to clean/fix it and now have it re-leased on a lease contract). One is about 4 months from exersizing the option. The fourth is just starting but not looking good because we didn't qualify the tenants well enough. The question is: When is the best sort of financial climate to offer the lease option to tenants instead of just leasing it? Or trying to sell it?

I think now is a phenomenal time to do LO. WHy??

It's much harder to buy properties due to the banks tightening up financing requirements. SO fewer people can buy.

You buy conventionally (or creatively) and then you should have TONS of eager tenant/buyers on the other side. Line them up in advance even and go hunting for properties like what they are looking for.

Lots of properties available + lots of people who can no longer buy - opportunity.

Lease options seem to be a good deal for investors, but what about
the tenant/buyer?

I am going to be moving to Albuquerque and ultimately I do want to buy
something there but thinking about renting first. That is a market where
there is a lot for sale, yet prices haven't gone down much overall, it's
just that houses are selling more slowly.

So there is a lot on Craigslist that is rent to own right now.
What it seems to be for the buyer is a way to get into a house
if you don't have good credit. But then they are asking for a
nonrefundable deposit and higher than market rent with the
excess rent being credited back.

It would seem to me that a buyer with good credit and not in
any great rush to get into a house would not be served by
such a lease-option, but am I missing something here?

PS I really appreciate having a place like this to ask my
questions!

It would seem to me that a buyer with good credit and not in
any great rush to get into a house would not be served by
such a lease-option, but am I missing something here?

I agree. THis is NOT your target. Your target is someone who wants to buy but cant (typically POOR credit). This gives them a year to try out the house while they are getting their credit in order.

Possible, that someone might want to LO to "try out the house and neighborhood"... but less likely.

What are tax certificates?

I'm in same boat as the Rev. (no foreclosures, but credit below 500)In your opinion (and/or anyone else's) is trying to buy a home a waste of time or near impossible without good credit? I'm inquiring to Credit counseling and plan to pay debts. But I have heard even after paying all debts, it takes a long time to raise FICA score.(near impossible) I'm single mom with two boys in school and want to provide a "home" for them ASAP. Any other options while clearing up credit?

FYI, I make good money and see a ton of "foreclosures" right now.

ANYONE...please advise. TKS