Renting W/ Option To Buy
Most investors I work for have had success in renting at a low rate and offering either a low sec. dep or a option fee for just a bit more. The philosophy is that you offer a sale price at more than what the property could possibly be worth in 1 year, and offer the option for 1,2 or even 3 yrs. To my surprise, many tenants chose the 3 yr term to make sure their credit was in shape at closing. They never stay the full term. Most end up defaulting by not paying rent on time. Owner gets to keep more than normal sec. dep. to get the property ready for new tenants and starts all over again. What do you think of this tactic? It seems to produce more profit while offering tenants a way to eventually purchase.
I have sold all my houses in the central FL area. If the price is low enough it will sell.
Will your house appraise for 210K? Get the opinion of a qualified realtor or appraiser doing a pencil appraisal.
If you really want to sell it it must first appraise for 210k, and then your people must be able to buy the house. Have them talk to a mortgage broker now so that you know their chances and they know what to do in the next 12 months.
I have an option agreement that I can share. Just email me.
I advertise my LO in the Orlando Sentinel FOR RENT, FOR SALE, and the LEASE OPTION section.
How old is the house. Is it in good condition - will it need repairs. What can you get for rents in the area? What is your PITI?
Brenda
My piti is 1341.00 per month. It is completely remodeled inside and out and shows very well. It is the least expensive house on the market in the neighborhood. The neighborhood is one of the better ones in the sebring area check out the houses website www.104tortoise.com
Yes it will appraise for 210k.
As far as seeing if a lender can qualify my buyer....Their credit is not perfect,that is why I am lease optioning it to them, In 12 months our goal would be that they could Qualify.
I am as low as I can possibly go and still use a realtor. I had it listed with a flat fee broker $300 and was paying 3%. for 6 months. now I have a full service brokr working hard but still no buyers. Lots of interest but no qualified buyers in Sebring Fl. WAY TO MUCH INVENTORY ON THE MARKET!!!!
Anyone ever get 15k down on a lease option?
Hummm. GBN brings up some things which are foreign to me. These may be FL statutes-"must appraise for option price and optionee must qualify for a loan". I think that those 2 conditions would eliminate most candidates for a lease-option. Question: Are these 2 conditions FL law???
In this case, the property will appraise for the option price. The rub is getting these people qualified for financing. They probably wont qualify now- but could qualify in 1 year with no "30 day lates" on their credit history.
I can be more helpful but only if those 2 conditions are not FL law.
what is the price per square foot compared to other houses in the neighborhood. after looking at your website, I have hard time believing that it is the lowest priced home in the neighborhood.
I am not aware of any FL law concerning LO.
I appreciate all of the input.
So I am looking at 2yrs instead of one if I am trying to get someone in the property and clean up their spotty credit?
with a 24 month option...It looks like I would be running the risk of the house decreasing in value with the way the market is going.
Just last week former chairman Greenspan said that he thinks we have not even seen the beginning of the real estate turmoil. It is very difficult to forcast a market 24 months in advanced but this is yet another risk.
At $1341 per month piti -it would be difficult to increase this amount In Sebring and still find a qualified lease option candidate. So there would be 0 cash flow.
B grossnickle- I too live in orlando-This house in Sebring is one of the smaller ones on the street. Per square foot it is the least expensive one on the market(a property just sold for 375k 5 houses down) in that immediate neighborhood. Yes there are cheaper houses 20 min outside of town but they do not have 1/2 acre lots and the neighborhoods are quite inferior.
Now that I have a full service listing
I have lowered my price as low as I can without taking a loss.