Selling on a lease option

[Sean Dezoysa]

One of the biggest "costs" of rehabbing is the tax hit. But if we could extend the sale out 366 days then we're paying long term capital gains instead of dealer income.

Just thinking out loud here: what if the deal was funded with private money and sold on a lease option to a tightly screened tenant who was required to pay for credit repair? If the screening is good, chances are also good for a cashout at a premium in 1-2 years at a favorable tax rate. What do you guys think of exiting this way? Smart? Risky? Unlikely given investor temperament?

[Brian Gibbons]

@Sean Dezoysa

I believe buying w private money, rehabbing and selling on terms, like LO or CFD is smart if you qualify the buyer and them help increasing their FICO score at their expense.