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
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