Usually, you will pay taxes but allow the seller the tax write-off as a "bonus" . You also pay insurance (never trust your buyer to make your payments for you) You will figure this cost into the rent from the your tenant-buyer.
Pass the fixup costs onto the tenant-buyer whenever possible.
It always makes it easier if the taxes and Insurance are wrapped in the original payment. You will be paying these by proxy through your payment to your seller but like above the owner (not you) retains the write offs. You just have to make sure he has his policy changed to a non owner occupied policy and have it in your contract, that your T/B has to provide his own renters policy, for personalk belongings and liability and furnish you a copy.
L/O's are so much easier than Sub To's (IMHO, sorry John). In doing your L/O contract put it in writing with the owner you will take care of (not pay) the day to day expences and maintenance up to $200 a month, if he would would help with anything majore above the $200 a month, they usually love that. Then in your agreement with your T/B explain that you would hope they would care for the property as their own as it someday will be and they should feel free to make any improvements they wish and it will not be added to the future value of the home, and they would be responsible for the monthly maintenance of the home up to $200 ie faucets, carpet cleaning etc and anything above that you would take care of as long as the got 3 quotes on the replacement or repair. Which you would give to you seller for approval.
I also have in my contract that the appliances if included are on loan and would not be replaced, that would be their responsibility and would get to purchase a replacement of their choice.
in my contract all are paid by my buyer...
exclusion of property taxes and insurance which is paid by the owner of the property...usually included in the mortgage payment
Quote:
On 2003-10-31 11:05, ramgon1280 wrote:
In a sandwich lease option who pays for these expenses and incidentals? <IMG SRC="images/forum/smilies/icon_confused.gif">
Good responses.. thanks guys... i have set a goal to make my first deal before Christmas. Im just waiting for a book on lease options which I ordered to come in. Its just these other little issues which I usually cant get a clear anwer on no matter what I read on. Its good to communicate with real people who can give me clear usable answers.
DaveREI,
would you mind sending me some of the language in your contract that provides for those terms you mentioned. PM me. Thanks everyone.
As with everything else in life it is negotiable.
Usually, you will pay taxes but allow the seller the tax write-off as a "bonus" . You also pay insurance (never trust your buyer to make your payments for you) You will figure this cost into the rent from the your tenant-buyer.
Pass the fixup costs onto the tenant-buyer whenever possible.
It always makes it easier if the taxes and Insurance are wrapped in the original payment. You will be paying these by proxy through your payment to your seller but like above the owner (not you) retains the write offs. You just have to make sure he has his policy changed to a non owner occupied policy and have it in your contract, that your T/B has to provide his own renters policy, for personalk belongings and liability and furnish you a copy.
L/O's are so much easier than Sub To's (IMHO, sorry John). In doing your L/O contract put it in writing with the owner you will take care of (not pay) the day to day expences and maintenance up to $200 a month, if he would would help with anything majore above the $200 a month, they usually love that. Then in your agreement with your T/B explain that you would hope they would care for the property as their own as it someday will be and they should feel free to make any improvements they wish and it will not be added to the future value of the home, and they would be responsible for the monthly maintenance of the home up to $200 ie faucets, carpet cleaning etc and anything above that you would take care of as long as the got 3 quotes on the replacement or repair. Which you would give to you seller for approval.
I also have in my contract that the appliances if included are on loan and would not be replaced, that would be their responsibility and would get to purchase a replacement of their choice.
Darwin in NM
in my contract all are paid by my buyer...
exclusion of property taxes and insurance which is paid by the owner of the property...usually included in the mortgage payment
Quote:
On 2003-10-31 11:05, ramgon1280 wrote:
In a sandwich lease option who pays for these expenses and incidentals? <IMG SRC="images/forum/smilies/icon_confused.gif">
For a slow market, sandwich L/O can be a wonderful technique for sellers with vacant units.
Eric & Rosa
[addsig]
Good responses.. thanks guys... i have set a goal to make my first deal before Christmas. Im just waiting for a book on lease options which I ordered to come in. Its just these other little issues which I usually cant get a clear anwer on no matter what I read on. Its good to communicate with real people who can give me clear usable answers.
DaveREI,
would you mind sending me some of the language in your contract that provides for those terms you mentioned. PM me. Thanks everyone.