Half of my sandwich is done!

and the best subject topic name ever

thanks Kevin, your giving hope to all of us in ca. frustrated by high prices.
ACTION& mistakes always outweigh analysis & paralysis!

Great deal. Go a little further. Find a engineer in that town or one near you. Find out if this 22 acres can be subdivided and how many parcels you can make out of it.Next talk to some excavators and drill or dig a few test hole. Think about something 22 acres times 43,560 thats the number of square feet in and acre. 43,560 x 22 = 958320 sqaure feet of land if there is 1 foot of top soil then you just made a ton of money. I'm from Conn screen top soil is worth $22 to $24 per yard.
I think this is were Dean tells you to think beyond your dreams.You made more than you thought.

Adam Negri

Adam the deal with the 22 acres is pretty far in the country and has basically a 1 to 1 1/2 car road and it is actually right at the bottom of a mountain and has a small ravine running through part of the property and is about 20-30ft deep. I asked him to to take some pictures of the house and property so I can start to market it as soon as I get them I would like to either e-mail them to you to see what you think or if I can I will put them on here to see what everyone thinks. I appreciate your vision and suggestions I haven't reached that type of vision yet but now my mind is running wild. It lets me know I need to start thinking Dean style. Thank you.

Thank you very much. I am trying to put as much info on here so others can learn as well as myself. I would love to put up a video showing the house and what some courage, action, and knowledge can do. I used absolutely none of my own money and I don't have the type of money I thought you have to have to be in real estate but what I do have is a WEALTH of knowledge and desire to WIN! Does anyone know if I can put one up and how? Also if I can does it have to be a completed deal because I haven't put a t/b in it yet but I have a few lined up and I do have my lease option in place so I control the property?

Thank you for providing so much info so us other newbies can learn from your success! Out of curiosity, how did you gain such a wealth of knowledge on how to structure your lease options and such?....kind of made my head spin!! I've read Dean's Profit Now, and just started on Your Town. Do you have other real estate investing experience, because I am truly impressed!

just go with the flow and see how it comes out and works best for you in this situation. do not forget to put all the ingredients together where they belong on top of it all.

shawn

ccsmom
This is actually my first deal I have put together. So I am a newbie as well. Most of my knowledge before this site was from studying I am really into reading for about 3 years now I have been on a personal transformation journey I didn't like where I was in life so I decided to transform into who I want to be so like Dean talks about in his Be A RE Millionaire Book you need to find time to improve your life and remove the mental blocks and negative thinking and believe you can make your goals a realty. I was already on that journey for 2 1/2 yrs before I came across Dean's book so it really connected with me. You must give up something to go up. You must ask yourself what is it that you are willing to sacrifice to improve your life? I pretty much carry 3 of Dean's books around with me or at least in the car at all times. His books give you alot of information compared to others. I actually never heard of Dean because I don't watch tv to often. I found his RE Millionaire book in a goodwill store where I go every other day and buy amazing books from RE to Leadership to Self Improvement. His book cost me $1.49 and is going to make me an unlimited amount of money. So you gotta love goodwill stores. Now I have bought his 2 newest ones and I'm about to join the academy. Now I am gaining alot of knowledge from being out in RE world and doing the steps he gives you in his books. Never stop no matter what. You are the only one who understands what you want. Don't let anyone tell you what you shouldn't do or can't do because what they are really saying is what they can't do. They're just afraid to do it themselves. Always think about where your advice is coming from and if they are qualified to give you that type of information good or bad. Good Luck out there and don't give up. When you do your first deal it is an amazing feeling.

Nice to hear of your first deal. I would like to see how this works out when you
finalize that L/O. How did you find the property to do this? Did you use any earnest money to cinch the deal with the owner? Did the owner happily wait for you to appoint a tenant buyer? Did you have to explain in detail on how a sandwich deal works and how much money you will make off that deal?
I have found a need for L/O in my area and I have tenant buyers on list from ads I have posted on C/L. But I'm having a hard time finding owners who are willing to enter into a L/O.

Got any I deas?

"Own Your future"

Ericisready

Good job. I hope this gives alot of hope for the new investor. Keep up the good work.

EriclsReady
I found this property on c/l and he wants the first months rent $1350 plus $1350 as a none refundable option payment but I do not have to pay that until I put a tenant in the house. So I will take $1350 from the 3% or $6,900 option payment the t/b will give me and then give it to the seller as well as they will also be paying the first months rent so that will just go into escrow to pay his mortgage. So I am going into this deal with no money of my own. I did explain to the seller that I was an investor and the only way I could purchase his house was to do a lease option because I can go right down the street and buy the REO that's basically the same house for $130k so it wouldn't make any sense as an investor to pay him $170k in todays market. Which he agreed wouldn't make sense for me and I left him at that then emailed him with my proposal and he excepted. Oh I also did not say how much I will be making off the deal. If you can't get them into a 5yr try a 3yr with the right to renew and depending on what price range you are looking at
you can also suggest if you renew your lease you will add on $5-10k to the purchase price. I am actually going to be suggesting that on a deal I am working on right now. Where the seller doesn't want to give up control of his property for 5yrs and even with doing that I will still make a very nice profit. Good Luck
Thank you sac-town are you a newbie and have you done any deals?

what kind of contracts did you use and where did you get them. I called the advisory line and they said to use a short lease form and a short option form.
I have a small problem with that. The short forms doesn't leave mention for much by way of conditions in a contract. Do you have an idea where to get the proper forms? Or did you use a combind lease with option contract on one form?
I would like to get into a form that is easy for me and all involved to understand.

Thanks for all your help. I feel my first deal coming very soon.

"Own Your Future"

Ericisready

I think your first deal is AMAZING and your story is SO inspiring. I have been devouring Dean's books for the last 5 or 6 months. I've been a paralegal for over 15 years so I tend to be rather anal when it comes to analysis, preparation and building a solid foundation whenever I do something. That said, my husband thinks I'm stalling because I haven't completed a deal as yet and he sees me doing all this preparation and marketing and so forth. That's just my nature AND I'm scared to death to screw anything up.

Anyway, I say all that to say that in the last two months, I have sent marketing letters and postcards to all pre-foreclosures (since my focus is on lease options) in 3 different zip codes in my area that I think are the smartest areas to start with. In total, I've sent out maybe 200 letters and/or postcards (rather ingenious marketing efforts if I say so myself). I thought they would get attention of folks who are struggling to pay their mortgage and even possibly in danger of losing the house to foreclosure. I have received only one response and this was from a gentleman who hadn't paid his mortgage in almost 7 months so he owed almost $25K in back payments, late fees and legal fees. Safe to say I had to walk away from helping him because I didn't have the funds to bring him current and I wasn't sure he was committed to trying to save the house. In fact, he already had a tenant/buyer in there who was under the impression he was buying the house from this gentleman, but the owner was not sending their payments in to the mortgage company. Needless to say, a sticky situation that I really didn't feel comfortable getting involved with.

My question to you is this: Is there anything else I could be doing that I'm not doing in order to get a better response? After reading other posts, especially you kdrobinson, I'm thinking I could make a better effort at reaching out to people trying to rent out their properties. I had done that for maybe two months and came up dry. From what I'm seeing, I feel like my efforts are one-sided and that I should be attacking this from several different angles, i.e., using marketing to pre-foreclosures, following up with people renting their properties, etc. Truthfully, those are the only methods I can think of off the top of my head. Help!

When you send out your letters you have to realize those same people are most likely receiving letters from other investors, loan modification people and who knows who else. So you have to give them something special other than just the basic we can help take your house off your hands style letter and I don't know what you are sending so I am not saying that is what you are doing. But you do have to be different and think out side of the box. Try and word your letter so it says you are different from everyone else. Maybe offer free advice about how they can save their house and if that doesn't work then you can possibly buy it. If you don't have any advice then pm and I will give you some or you can do the research. Most are probably in denial and will wait until the last second. So I believe trying to help them save it and keep it will put you ahead of the game. I am targeting fsbo's because it is very hard for them to sell right now and with a l/o I can give them fmv and if they are motivated they will do it. I am also targeting people who own their homes out right. I have a RE Agent who tells me how much if any the sellers owe on their property. Here is a deal I am working on right now everyone tell me what you think.
Seller: FMV $90,000 owns it out right.

Kevin:
Purchase: $90k
5yr lease option
Non-refundable option payment: $1,000
Rent: $800
Purchase credit from rent: 100% or $28.5k for 3yrs(T/B's Lease Agreement)
New purchase price: $90k - $28.8k = $60.2k

T/B:
Purchase:$100k
3yr lease option
Non-refundable: 3% or $3k
Rent: $950
Purchase credit from rent: $150 or $5,400 for 3yrs
New Purchase price: $100k - $8.4k = $91,600

Profit
Front: $3k - 1k= $2k
Mid: $150 mnth or $5,400 for 3 yrs
Back end- $91.6k - $60.2k = $34,400

Total: $31.4k + 5.4k + 2k = $39,800 Total Profit
It hasn't been excepted but that is my first offer. We will see what happens. I am new but I have a very creative mind and I am always trying to figure out different ways to do things and with all the options with RE my mind can go wild. I Love It!!! What do you guys think any suggestions.

Keep up the great work. I am looking to implement this same strategy just as you are soon. I have mainly been working with finder's fee's for the most parts. Can't wait to see how this all finalizes for you. Way to get that have sandwich made. Keep pushing forward.

Josh

that deal looks great.

If I am understanding this lease option deal correctly...
So in 3 years you will buy the property from the owner at $60.2k
Then the tenants has the option to buy the property from you at $91.6k
netting you a profit of $34,400.

What about if the tenants does not want to buy after 3 years. Do they keep paying rent as normal and the lease option becomes null and void or do they have to pay a fee or something. And then you start looking for a new renter or buyer.

If they don't buy will you still be leasing it from the original owner at a monthly rate since the lease option was for 5 years?

Also.. Where did you get the lease option form. I would like to look it over to read it.

Thank You
Stan
This looks like something that I would be interested in doing since I don't have cash to invest right now.

The $34.4k is actually $31.4k I typed in a wrong #. Stan the sales price to the t/b is actually $100k but with the $3k OP and the $150 a mnth Purchase credit when he opts to buy he will only need a loan for $91.6k. So my profit would be $39,800. $3k up front, $5,400 during the 3yrs and $31k at the end when they purchase. Hope that makes sense. As far as if the tenant buys at the end if they choose not to then I can renew with them for another yr or two and the rent will go up as well as the sales price and I will probably ask for another option payment to make sure they are serious. If they move out then I start the process all over but this time I raise the purchase price as well as the OP will be greater because of the value of the house and the rent will also go up to market value at that time or I can just purchase the house myself but really there is no reason to do that. By asking for a 5yr lease I am acquiring a 2yr saftey net in case the t/b chooses not to buy I then have time to put someone else in the house for 1 or 2 years at a higher purchase price and in all reality if the 1st t/b's do any type of improvement to the house I benefit and I stand to make a much larger profit.
Because of appreciation as well as the improvements they have done. As for the form I used what greg murphy used but I am meeting with a RE Attorney and drafting up my own with that implented. I hope this helps you if not let me know.

Kevin,
that helps a lot. Thank you for breaking down for me.
I have to find me a RE attorney as well and keep them on stand by.
Thank You
Stan

Well my newest offer was turned down but that is perfectly fine because the guy who owns the house is an investor as well and I was just trying things out and I was hoping it would peek his interest and he would want to meet and try and work out a deal and that way I could talk to him and possibly put him on my buyers list. RE has so many ways you can approach a property. It's a blast working out the #'s and seeing if you can make it work. Soon I will be part of the inner circle and in Dean's books. Does anyone know exactly how to get into the inner circle? I'm glad I could help Stan if you need anything else just let me know.

Breakdown really helped me Any help sent to my inbox would be greatly appreciated

I have a quick question, do you need to involve a real estate agent to complete these types of deals? Or can you do this without a buyers agent involved?