Seller financing strategy instead of buy and holds

4 Replies

I have two rentals both with tenants and their 1 Year lease agreement will be ending early next year. If they don’t renew their leases I am considering going another route and offer seller financing. Or perhaps a rent to own strategy instead. Any thoughts?

@Sharon Deloris What does the lease specify about the right to they have a the option to renew? If not, you can move forward and elect to not renew the lease.

As far as offering financing to an end you own this property free-and-clear?

If yes, a purchase money mortgage may be a good option...originate a note/mortgage to your end buyer...structured on a balloon you're comfortable with. We typically look at these as 36-48 month balloons on a 30-yr am schedule...7-8% interest...10-20% down...

Alternatively, you could structure a lease with an option to buy....same basic concept but it works differently...contract for deed offers the seller the most protection because you hold title until the terms are satisfied...and there are a few variations of each...just depends on what you're comfortable with.

Not exactly. I’m looking at possibly a 5%-8% down payment against my purchase price with a 2 year lease agreement. 

What recommendations do you have in mind? 

Updated almost 3 years ago

3% to 5% actually