OfflineHello All... We have been trying to Sell our third Fix and Flip to no avail... Our next step is to Rent this SFR but have ZERO experience... I printed out the following Document from DG's list and need help with some questions:
1- Agreement to Lease with Option to Purchase (Doesn't seem like it is a Contract geared for the seller?)
a. Don't get the Personal Property Included
b. Don't Understand the Existing Loans
c. Purchase Price - Do you normally ask for Current Market Value? If so, what happens at the end of a 2 year Lease with Option and the Market Value Changed in either direction?
d. Don’t get #1 Terms, #3 Not to further encumber (I have 65% of the Property Value in a Mortgage and 35% on MY HELOC... I want to Refinance and get a check at closing to payback my HELOC)
Can anyone with L/O to purchase experience (Preferably in NJ) as a SELLER 1- help me create a Step By Step, 2-Offer their own Contracts, 3- Run through key DO's and Don'ts... I placed an AD on Craigslist 2 days ago and got to calls yesterday one to rent and one to Lease with option purchase... I have been researching through this forum and have general knowledge but am afraid I may make a Huge mistake...
Please!!! Any advice, guidance would be greatly appreciated!!
Happy Thanksgiving to You and Yours!
Dan and Dianna - Mcarlo24
Click on the link below for a offer formula and don't forget to add 70% of FMV if you're going to assign it.
Offer Formula
http://www.deangraziosi.com/node/3975
Have you already spoken with a real estate attorney? If not, you're going to have to get one to look over the agreement your using.
lease the house for x amount per month, 12 mon lease
separate option to purchase fee of x amount for 12 mon(non refundable)if option to buy is NOT exercised - if is exercised ,applied to selling price
price of house should be higher than fmv to cover increase
EX:
lease for $1200 12months- some ppl will apply $100 mon toward purchase
option fee $10,000 non refundable
selling price $140,000 (fmv $125,000)
look up 'kareng' here on dg, she's the L/O Queen
Mike
https://tvallc.isrefer.com/go/RehabLite/renvestr/ Free tools
Good stuff!!
"dump the clutch and nail the throttle"
"Just do it, Get it Done!"
--Matt Larson
separate option to purchase fee of x amount for 12 mon(non refundable)if option to buy is NOT exercised - if is exercised ,applied to selling price
price of house should be higher than fmv to cover increase
EX:
lease for $1200 12months- some ppl will apply $100 mon toward purchase
option fee $10,000 non refundable
selling price $140,000 (fmv $125,000)
look up 'kareng' here on dg, she's the L/O Queen
Thanks for the information Mike... I am working on getting in touch with Kareng
... After doing some research it seems that COntract(s) need to be written to avoid the T/B trying to sue for Equitable Interest if they can't get the financing... Seems a may need to get a Lawyer involved... Curious to what the % of folks that have done L/O that got a lawyer VS. not...
Thanks
Dan - Mcarlo24
Excellent book on L/P...however, I recommend you contact an attorney to finalize the contracts you will use. The book covers the Contract for Option which deals with the equitable interest issue. The TB is not given an outright option. The TB must satisfy certain requirements in order to be granted an option to purchase the property, thus eliminating the equitable interest claim. You always want to purchase with a lease option but sell with a contract for option.
http://www.amazon.com/Secrets-Lease-Option-Profits-Strategies/dp/1888699...