OfflineOn p.71-2 of "Profit From Real Eatate Right Now" Greg M of Booneville, MS describes how he used a down payment from his prospective purchaser to fix up a property he had under contract. Since he doesn't explain how this occurred I am not understanding the process.
What prospective purchaser would allow his down payment to be used at all for anything other than closing the transaction? What happened to the escrow in this case? How did he convince the prospective buyer to allow use of the down payment?
__________________
I believe he is talking about doing a lease/sandwich lease option
in a lease option, you collect a down payment of your choosing for the amount(non-refundable) and then collect "basically" rent until they are ready to buy the property.
it is good for if somebody can't get a loan right now, but in 6-12 months, they may be able too...so you lease it to them till they exercise there right to buy the property...
--in what you are talking about, that down payment money he collected originally, he used that to fix up the property since the lease option down payment money is non-refundable
IF I AM WRONG, please jump in someone and explain it better
~TAKE ACTION AND THINGS WILL HAPPEN~
***Something to Believe In***
"If you want something, GO GET IT...PERIOD" Will Smith
***"I CAN'T IS NOT A EXCUSE...IT JUST MEANS YOU WON'T"***
"Obstacles are those frightful things you see when you take your eyes off your goal" Henry Ford
~"Success doesn't come to you...You go to it" Marva Collins~
that's the way I understood it too, marc
Bryant Slade
Im confused...I thought the non-refundable money was used to pay down the loan or used as a down payment for the buyer at time the option is executed.
You're the buyer. You've locked a home up in contract and now you market the heck out of that home to get someone into it because you're in need of the cash to (a)fix up any cosmetic issues with the property (b)pay towards the purchase price of the home. Well as the buyer, you've stated for a certain period of time to come up with the money to pay towards your down payment(hence the lease option to another buyer with bad/shaky credit). You charge that new leasee however much percentage of a down payment as you like so that way you(the buyer)not only have money to fix up any defects in the home, but also to put towards your(the original buyer)down payment. I think that's pretty close to it. I may be a bit off here or there, but pretty close though.
Bryant Slade
I think I've grasped the idea. I appreciate your time.