Purchase to lease option

[Jordan Woolf]

I spoke with a long time agent/investor that has been buying houses and then turning around and doing a rent to own to a buyer tennant.

I know this strategy is not new but what I found interesting was that he was collecting 20% down payment from the buyer and charging 10% interest.

It sounded like he would find the buyer tenant first and then let them pick the house that they wanted on the market. From there, he would purchase the house using a conventional 20% down mortgage and get his 20% back from the buyer tennant plus the difference in the monthly payments.

I did not go too in-depth about how the deal was structured with him so I am curious if anyone else has any experience with a similar strategy?