Hello Everyone- I am very new to BP and a beginner to real estate. reading Podcast, and educating myself it seems that rent to own/lease is the best way for me to start in real estate. I am very interested in rent to own/lease deal. My question are, is a down payment involve in Rent to own/lease and how do you know if your getting a good deal on a rent to own/lease?
I have this exact same question. I have decided that this is the year I'm starting my real estate company. No matter what I'm buying. So, I'm researching lease to own the either owner finance it out or just rent it out.
The renting it out option does give you some equity it normally only a small percentage of the rent will be deducted from the agreed sale price when you go to buy out the property in whole. So, renting only buys you time until you can get a loan to actually buy the property.
But...what if you owner financed it out after signing the lease to own contract? ?? If it's a $100,000 property and you owner finance it fir 20% down, you just put $20,000 in your pocket. Then take that $20,000 and do what with it??
I'm just trying to be creative here, but if you put $3,000 down to lease/purchase then a month later get a $20,000 check from an owner financer, seems to me you turned $3,000 into $20,000 in 30 days. But your still stuck with a promise to buy the property out in case in a certain amount of time. So, then what are you left with?
$20,000 to invest in other properties I guess.
I'm just trying to learn.
other option: do lease to own in distressed property. Get a partner to renovate fir free if you split the profit, then sell it at a big profit. All you did was put the deposit money to secure the lease/purchase contract.
This is the only tactic I know that could work...but still learning
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