Architect · Toronto, Ontario · Member since 2015 · 40 posts · 6 votes
Hi all,
I have a potential seller interested in doing a rent to own agreement. I plan on wholesaling this to another buyer.
Is anyone willing to share a sample of a contract that they use for this type of agreement?
Also, can someone please explain to me how the following works:
If I have a contract with a seller which states, for example, that I will pay them $2000 deposit and X dollars for the monthly rent, how do I set up the agreement with the new buyer to state a higher deposit? Is it through 2 separate contracts?
Essentially, I'm just interested in connecting the owner and buyer, and making a profit through the deposit and then move on to the next deal.
Rental Property Investor · Gambrills, MD · Member since 2014 · 372 posts · 88 votes
10y
I think this is normally done with just an option to purchase. Doing it with a lease option can significantly inflate your cost, especially if you don't have a buyer lined up to assign it to quickly.
You would make sure the agreement with the seller is fully assignable buy you without need for the seller's approval. You would have a separate assignment agreement that would assign your right to buy under your agreement with the seller to the eventual buyer. The assignment agreement would assign your rights in exchange for an assignment fee (not a deposit) that would be equal to the fee you paid the seller plus your desired profit.