Lease Optioning our First deal= Quick $20K

Thanks for sharing the details of your deal. On to the next one.

It is all about pressing the right buttons. You asked and you received. A perfect example for all of us. Congrats, God Bless.

Sandra

Great location, we can't buy anything for 10K, usually nothing under 35K & cash flow of only 150 to 200(if you're lucky) .... BUT a 4 - plex with 1500 cash flow, maybe we'll come back up north & brave the cold & the snow.

Ha ha.....braving the cold and snow, I'm not so sure it's worth the tradeoff This was a very good deal and I have never seen quite these numbers even in this area. We were looking at a similar properties with less cash flow, questionable areas for around 50K, so when this deal came up, we literally jumped on it! We looked at it and I already had the paperwork signed ready to go and it was done on the spot. I knew it wouldn't last if we didn't. Not to mention that the area it's in is undergoing a million dollar renovation thanks to taxpayer dollars and grants. It's right in the commercial district, very nice area! And our end buyer is very pleased, because he still got a great deal at 30K, that's over 20K in instant equity for him.

congrats on your first deal. That is a truly amazin deal. Sounds like you hit a home run with the guy that wants to partner up with you too.
good luck going forward
Richie

Congratulations Sheila!
Great job and thanks for sharing your success!
Judith

I hope this post can motivate others who are hesitant and may need a little push as well! The first deal seems to take the longest, but once you get through it (step by step), it gives you unbelievable momentum and confidence. Real estate is definitely addictive! Thanks, Dean

Nice work!! Keep the details coming for the next one. Good luck in 2011!!!

Sheila Congrats Now keep it going. As I always say

KEEP MOVING FORWARD AND YOU WILL REACH YOUR DESTINATION SOONER.

Congrats on the great deal. I was wondering if you might share the paperwork that you used in your deal. I am currently putting together a lease option to buy on 3 duplexes.

Thanks

Wow, I am amazed on this deal. What did your flyer look like and where did you put them? That is very motivating, and it does help us to keep going. Thank you, Midwest.

midwest_invest wrote:

We are getting ready to close on a 4 plex in our town Feb 1, so I thought I would share the details. Motivated seller saw one of our flyers and called because she was having medical problems and just wanted out. Property assessed at 54K, cash flowed $1500/month. We offered her 10K and she took it. Within a few days, we had cash offers of 15 and 17K to assign it. Could have done that for a quick 5-7K, but decided to be patient and make more $$. We have a private lender to lend at 7% full purchase price plus extra 4K for rehab. We decided to advertise seller finance/lease option for this property and had it sold within a few days. Buyer offered us 30K if we could finance for a yr. So, it looks like this: buyer is to pay us 5K down due in June, $250/month (our payment is $100/mo), and the remainder of the 30K is due within 12 months. He is doing all rehab and is covering all expenses. We will walk away from closing with 4K in our pocket and then make another 15K within 12 months. Not bad using none of our money!! And about 2 hrs. of work! Now working on our next deal! Our private lender wants to partner with us on some storage units, so we are looking for some right now to buy. Anyone in the midwest have any?

midwest_invest wrote:

I hope this post can motivate others who are hesitant and may need a little push as well! The first deal seems to take the longest, but once you get through it (step by step), it gives you unbelievable momentum and confidence. Real estate is definitely addictive! Thanks, Dean

You are Sooo right on motivation!!! I am truly inspired by this deal. I haven't done my first yet.. I am reading the books and I know my motivation and Faith is growing stronger everyday that I can succeed at this.

Congrats on a great deal and to many more in your future. Thanks for sharing.

Tammy

That is great motivation! If possible, can you show me the paperwork that you used in your deal. I am currently putting together a lease option to buy on 2 duplexes.

Thanks

Great deal for you and a nice way to put some quick cash in your pocket.

I enjoy reading the details of a deal - that is where you learn the most .

Keep on trucking !!

Randy S.
Elkton MD

Hi Sheila, glad to see that you guys were able to get your first deal finished. I hope this inspires you to go for more deals, the next one will probably have a higher pay out. Keep on Keepin On.

Great job on this deal.i love lease options! Let me know if your buyer backs out in any way .congrats...on this deal and all the work you have put in.put Nother iron in the fire you have a good flame built up !!

Jay

Congradulations Sheila on successfully completed your first deal. Hope for many many more to come

Tyeisha

Great Job I am glad to hear about your success you made the deal so good it didnt matter what strategy you used there will be many more good things to come for you CONGRATS TO YOU!!! I cant wait to read about your next deal keep us posted. God Bless DGF.

Sheila,

thank you for sharing your first deal; great way to start! it definitely inspires us all!!

Valerie

Sheila. You may have hit a home run on your first deal and that is fantastic. Use the momentum to go to your second deal, because as you say; real estate IS addictive.

Sheila. You had your ups and downs and doubts. But you did it !! Keep it up.

CONGRATS to you Sheila and HAPPY NEW YEAR! GREAT JOB and wishing you continued $ucce$$!

is it a smart idea to use a hard money lender to enter into a sandwich lease option? I'm kinda scared to use the hard money lender I know right now. Also congrats on your first deal.

1. I would never use a hard money lender on a sandwich lease!
2. I don't think a hard money lender would lend on such a deal.
3. Private money would be the ideal funding source.

Michael Mangham
MD Home Acquisitions LLC

but going even further, you don't need any money for a sandwich lease if the seller/lessor of the home to you will work with you regarding the option fee.

I can't even think of the last time I gave any money for a lease/option agreement. Probably 2006. The market is working in your favor right now so take advantage of it.

Congrats on your first deal. And thank you for posting the details keep going.

brad

great deal! congrats! you did your creative thinking and it's paying off for you. way to go!

Sheila,

Thank you for inspirational note, I'm just getting started great to see such success. I have a question for you, you indicated she saw one of your signs!
I'm in the process of developing my own signs curious as to what specifically your signs said? Also, did you direct to 800 number or personal line?

Thanks for the help and good luck as you move forward.

Theo

I've had quite a few messages regarding the signs we use. Ours is absolutely nothing special, but I think that's why it works. Greg Murphy outlines his signs on one of the Edge DVDs (I believe 2009) and his are VERY simple. Ours are handwritten with a black sharpie on white paper. Then we copy it on our copying machine loaded with bright orange paper. That way, we have tons of "handwritten" signs in a few minutes.
They say:
I BUY
HOUSES!

-Any Area
-Any Condition
-Local Buyer

Our Phone Number, Call Anytime- Leave Message
____________________________________________
Then 8 cut strips on the bottom with our info (pull and take type strips)

No big secret with the signs, the only secret is to put them everywhere you can. If you never post them, you will never get calls. Supermarkets, laundromats, cigarette shops, anywhere that will let you.

As far as the phone number, we use ringcentral and have an automated message set up, but we chose to use a local number instead of an 800#, so we would look like a local buyer.

Private Money--- We already had a private lender ready to go before putting in our bid, so there was no doubt that we could close if we couldn't assign it (which was our goal at first). Then, we got creative and knew that if we set up our loan with private lender at 7% for 2 years, then we just needed to find someone to pay us more than we were paying and have their term due before ours. We could triple our profit this way. This strategy, however, would not work with a hard money lender. Please note that there are tremendous differences between HML and PML. Feel free to search the forums for more specifics. Tammy (Zion Properties) has some great posts regarding this and is much more versed than myself on specifics. I do know this-- with hard money, you need to flip/refinance quick. It is VERY expensive. Like others have stated above, ideally you wouldn't even need a PML for a sandwich lease. But our seller wanted out and needed immediate cash. You could, however, probably find a buyer that could pay enough down payment (option consideration) to cover the immediate cash that seller needs and do a sandwich that way. However, our buyer that offered us 30K, didn't have the 10K immediately for option.

I highly recommend studying the Greg Murphy strategy. I watched his section from Dean's Edge DVD's over a dozen times. A few months ago, I was starting to doubt if my investment was worth it for the Edge 09/10, and SFL, but it is all really paying off now!

Congratulations Sheila,

I know that you are happy to be putting a deal together. I like how you look at the entire deal before deciding where to go.

Good luck in your future investments.

Ty