Selling/buying Lease Options
I have been working with a guy that I will call my mentor. He handed me 3 lease options the other day and said he wants to sell them as a whole. He is challenging me but I honestly haven't a clue on this one. The earnest monies total $7500 and the total purchase prices on the houses are $219,000. One option is up next August and the other two are the summer of 06'.
Question: If you were a buyer what would be your terms and what other questions would you have for this situation? Do you get the earnest monies?
Thank you,
Nick
I would assume this would be done by selling the property sub2 the lease and option to purchase by the tenant.
Will your mentor sell sub2 the existing financing or does he/she require the investor to get a new bank loan. This will make a difference to most investors.
As for what terms would I be interested in---I've never bought a deal like this so I guess I wouldn't know. I'd want to take the property sub2 and have the seller carry a note for the balance. I'd probably want at least $100-200+ per month profit and actual purchase price would depend on the loan balance, FMV, and the option to purchase price. Regardless I'd be looking for a $15,000 profit center.
I'm not sure if this helps but this is my two cents