OfflineI've had some experience with doing lease options in teh past. I put 5 properties under contract but could not collect an option fee. That proved difficult so I have another idea.
I want to get a 100,000 line of credit. Find a property valued at 200,000, selling at 150-170. Put 20k down, finance the rest hard money or with a mortgage broker.
Put a renter in it. Put back on the market immediatley and sell for 190. make 20-40 k profit. What do you guys think.. Will work, any unforseen problems.
Seriously thinking of looking for a line of credit. Thinking this is best when the market is in an upswing but what if I could get shortsales or foreclosures right now priced steeply below??
Preciate all responses.
You can make excuses, or you can make money, but you can't make both. -Dean Graziosi
Sounds like a plan,but my question would be if you put the house back on the market asap,what type of lease would your tenant have? the reason i ask,if the property sold immediately what would you do with your renter?
I would think it's easier to put the property back on the market without a renter, and market for owner-occupied (OO). OO will qualify for a lower interest rate and typically would be able to pay more house for the same mortgage payment vs NOO. Plus you won't have the hassle of trying to show the property with a renter in it (typically 48 hours notice required, depending on the state).
- Tom
Kevin,
I am with Tom on this one. You will have a hard time selling a investment(rental) property when its only %5 off FMV. Dean has had 2 recent video blogs talking about where investors want to be(% FMV) when they buy, sure having a renter already in place is great, but buying a place at 95% fmv would not bring many to the table.
SEMPER FI
GET SOME!
if you have had problems collecting option fees on the 5 properties you put under contract; perhaps your marketing skills need to be realigned. I say this because collecting an option fee is easier than the process you want to follow in the future and I would hate to see you have bad results with more at risk.
Always Looking to Acquire Houses | Always Looking to Amaze Investors