Closing A Lease Option

Comments(7)

• 
  LeaseOptionKing17th January, 2005

  I use a simultaneous/collapsed closing.
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  jdflybuy17th January, 2005

  Wouldn't it cost less to @ssign the option for your spread , to the sub-tenant/buyer at the closing? Assuming this is a sandwich lease. Or is there a problem I don't see in doin it this way?
  
  JD

• 
  LeaseOptionKing17th January, 2005

  Depends on the size of your spread and how you get paid. Assignments can present other problems, such as the T/B knowing your profit.
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  jbinvestor17th January, 2005

  Is this also the case when you are closing a straight option?
  
  Do the simultaneous closing?
  
  Does that creat problems with a new buyers lender? Or should I do my own due diligence and lead buyers to lending where this would not be a problem?
  
  Or will it pose a problem at all? Doing a simultaneous close on a straight option. Wouldn't the lender want to verify I have title to the property?
  
  JB
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• 
  LeaseOptionKing18th January, 2005

  If you are using straight Options on junkers (wholesaling), seasoning is a nonissue, because professional rehabbers either use their own cash or private lenders (hard money). Otherwise, you have to find a lender who will treat the deal on a case-by-case basis (and base their lending upon the comps regardless of the time involved).
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  jbinvestor18th January, 2005

  what about non-junkers.
  
  say a $150,000
  
  you have an option for $100,000
  
  if you found a buyer for $125,000
  
  would you do a simultaneous close on this? would the lender have issues because you (when you are selling) do not have title to the property?
  
  JB
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  LeaseOptionKing19th January, 2005

  Depends on the lender. Some do. Some are flexible, providing you can prove the value.
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