OfflineI need help. I have a buyer that has to do aleas purchase who is in desperate needs of a home. She moved out of her apartment and keeps sending me the housed that she likes. The two obstacles with her situation are her lease is between $800-$900 per month, but she only likes big 3br 2ba homes in nice neighborhoods.
The other obstacle is she sends me these homes like I'm her realtor. The latest house that she wants me to work on for her has been on the market for over a year, but was built in 2007...so I figured it has probably been under cotract and fallen out a few times because it hasn't been lived in. The builder is represented by an agent who gave me a tour of the home. At an asking price of $164,000, is this even something that I should be trying to do?
I have to do a lease option in order to be in the deal, but the house is already marked 20k below FMV. How do I negotiate with the builder through an agent to even see if they would be willing to do a lease option? The buyer also only has @$2500 upfront. How could I work this to make a profit, if the builder agrees? This builder is a large national new home chain.
Any help is greatly appreciated.
I've encountered the same difficulties as you. I've ran around looking for a lease options for clients and it usually doesn't work out in the end because the client ends up being too picky about the propery. That's why its better to work with a pool of clients...
MY ADVICE? Put up a Fake ad on Craigslist and on bandit signs saying "Rent to Own," or "You Can OWn, Bad Credit ok." These Fake Ads (Ghost Ads) are simply used to build your buyers list. People should respond because there are alot of people out there who are DYING to own but don't think they can, down know how, etc. You Need to have a mortgage broker handy who can qualify these buyers, or tell you how close they are to being able to qualify. After you have a list of 10 to 15 tenant/Buyers, begin your search for a desperate or eager seller. Get the property under contract and have an open house for all your tenant buyers to come see the property (preferably all at the same time so they know other people are interested in the property which increases eagerness).
This way you're working with a Group of Buyers and you know their status and how soon they can buy the property because you've already qualified them with your mortagage broker..
Sounds better than running around like a chicken with his head cut off trying to satisfy ONE buyer who may never be satisfied...doesn't it?
Also, Read Greg Murpheys Chapter in Dean's Most Recent Book "Your Town, Your Profits." It explains everything I just did in more detail
Push ON!!
Jordan
"You gain strength, courage, and confidence by every experience in which you stop and look fear in the face. Do the things you think you cannot do. Tough times never last, but tough people do"
Reading Your Town Your Profits about lease options. Read Greg Murphy how he lease option both seller and buyer and made some money. Haven't got to that point yet need to develop seller and buyer lists. I can do it if I try. As soon as I do my first lease option I will write about how it went. Thanks
Here is how mine went. Found a homeowner, property had been sitting 3 yrs on the market no buyers. I own a cleaning co. so they asked us to clean it. We did and they were amazed, cause his son was living in the property and not taking care to clean it. I offered lease/option, he agreed, what I did was offer 1K up front along with first months payment, I found out what his payment was and if it was something I could do. it was, so I ran ads on CL, and my biggest response was Signs. I made a sign before I even got it under contract, that said, 3br 2ba RENT TO OWN! got tons of calls. showed the property twice, my terms were 3K down 700 month. Owners payment was 612.00, so I knew it would cover it. The owner is responsible for taxes and insurance during the lease which is 2 years. That gives the tenant/buyer time to re-establish credit to purchase the house. I gave the buyer 50.00 credit each month toward the purchase price, which I listed to the buyer for 138K , The homeowner, I offered 129K which is what they wanted out of the house, I told them upfront, that anything over the 129K I made, I keep. They agreed. So, basically, I made 2K and some change, never put a dime of my own money into the deal. If they default, they loose the credits toward the purchase price and the money they gave down is non-refundable deposit. It helps all the parties involved and everyone is happy. the owner got 1,400. I got a little over 2K. I would ask your buyer how much cash she has upfront, 3K-10K if the builder needs 2,500, I would take a minimum of 3K that way at least you have 500 cash for you. and elevate the price to the buyer, so when she buys it you make money on the end, and, be sure the payments are something your buyer can afford, cushion them so you have positive cash flow each month. Hope this helps.
Went to Craigslist and found a buyer for a 1/1 condo, offers $25000 in gold and jewels, want seller to take back mortgage for balance, 1-2 years, 5% interest/year 1-2 years, monthly payments, balloon 1-2 years, buying it for his aunt to live in. Now the seller has a 1/1 condo in South Florida, for $295,000. I would bird dog it if seller agrees after I have gotten more information on the property. So any suggestions because I'm a newbie.
Thank you so much for sharing your experience. I have a buyer that needs to do a lease/option. So you wrote out a lease/option with the seller and then turned around and wrote like a lease/option with the buyer on your terms?
I am having a huge problem with the buyers not wanting to sign the pre qual form for my mortgage broker to see where they are!!! Any ideas on how to do this and get results. out of 20 calls of potential buyers one sent me the form back and she didn't sign it. I dont know what to do? Any suggestions