I am new to the lease option market and wanted to hear what other investors experiences were. Thank you
That is a broad question and I am not sure what you are asking in reference to using lease options.
As a landlord, i use leases and options to purchase for my tenants. It was worked great with the typical landlord/tenant issues. I have only had two options executed into purchases in 15 years of providing a tenant the option to buy. Most of the tenants will not follow thru with the lender. I get the tenant with a lender in the very beginning but it is usually not something they follow thru with.
@Johnna Lodge, do you have a set way you structure (ie- x down, x- towards principal, etc) or is every deal different?
I would like more info on this also. Could you give us the #'s one one of these options?
This seems to be a way to get better tenants.
When the market was great, i would get $5K down or more non refundable towards principle.
The higher the down payment the better it would be to close at an attorney's office (we close with attorneys in Georgia)/Escrow Agent ..
rent would be rent that was appropriate at the time for area and property
I would give $50 a month rent credit (you could give more also more if based on down payment)
And up the sales price $10K above market since they could not buy the property at today's value with 3 years to qualify and purchase.
House is worth $135K
Lease Option $145K
4 bed 2 bath w basement rents for $1200
$50.00 equity credit (reduces the sales price if they cash out)
$5K down reduces the purchase price for perspective buyer and/or tenant
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
Join the Largest Real Estate Investing Community
Basic membership is free, forever.