I bought my first home in October of 2014. I've decided I don't want to live there anymore and I've always wanted to be a landlord. So I was going to lease it out but then I heard about lease options.
Lease options sound almost too good to be true to me so I'm wondering if I'm missing some partial element. I like the idea of money option that is nonrefundable. That makes me feel safe in the event that I have to evict the tenant. I like knowing that after the lease is up, the tenant may buy it, which is good for me, and if they don't buy it, I get to keep the option money so I still win? I understand if the house appreciates a lot during the time, then I may lose out on profits but I still don't see what's so bad about going this route.
Is your coach in Indy
Hi @Michael Swogger . In a nutshell it sounds like you got it right! Just make sure you do a completely separate lease and separate option to purchase. Mine do not reference each other. You don't want to have an eviction turn into a foreclosure as a non-payer proves a case of equitable interest. Good luck!
Welcome @Michael Swogger !
One the main elements with a lease option [like ALL business opportunities] is rock solid contract. DO NOT download from rocketlawyer or something off the web for free or $50.
You will need to have a local, REI friendly, attorney draw one up for you. This should cost under $300.
Next, like all rentals, you will want to be sure to screen the prospective tenant/buyer thoroughly. I use NTN. Like the contract, don't skimp. Pay for the full back ground check [it's only $35 vs. $17].
Get as much option money as you can. This can vary from a few hundred to several thousand.
You're on right track, now get some education and start pushing forward!
- it's always good to see another Hoosier utilizing this great site!
Of course, you need to read The Ultimate Beginners Guide to REI here on BP
If you haven’t already, please read/listen to these books ASAP!
Flip2freedom episode 77[http://www.flip2freedom.com/a-3-step-formula-to-a-successful-balanced-and-insanely-profitable-2012/] - podcast - LISTEN TO THIS TODAY!
Wholesaling101 You Tube Channel
Kent Clothier – You Tube Memphs Invest channel
That is awesome list!
Here are some other books not in your list...many have not seen them...
Do not read those books unless you want private money and impress your sellers! :)
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you
You must be a BiggerPockets member to post on the forums
Join the world's largest, most open Real Estate Investing Community online, 100% free forever!