What should I do with a potential tenant buyer who says he has up to $50k to put down on a property but he has very little credit so he probably can't qualify for a mortgage in the near future? Should put him in my tenant buyer program and look for properties as usual or because he has so much of a down payment are there some better strategies to use?
Not sure what $50k represents as a % of the overall purchase but I would take the whole amount as an option consideration. I would check with my mortgage broker and figure out a strategy that works. There are also private lenders that may be able to give him a mortgage. But do make sure you have an exit strategy for him.
Jim, You are amazing. It seems like every time I make a post you provide very timely and helpful information. You are a real asset to the BP community.
@Robert Burns I'll let them prepay or buy down (however you want to look at it) the rent. So let's say I was looking for $25k down and $3k/month for 24 months. I'll let them do $50k down, $2k/month for 24 months. You make less cash flow because you got it upfront.
You're missing the boat. Take $10,000 from him and sell him the property on a land contract deal. Borrow the other $40,000 from him and go out and buy some properties.