Why Would A Seller Prefer The Lease Option To A Conventional Sale?

In communicating for the first time with a potential seller what can be said to persuade the lease option? Why would he consider it moreso rather than a conventional sale? confused

Comments(6)

  • ramgon128030th October, 2003

    In addition to that question, another related one is, what are some prime examples or situations which would indicate a motivated seller?

  • Gonzo30th October, 2003

    Another question is why would an investor go for the Lease Option and not for the Sub to.

    Gonzo

  • raider071830th October, 2003

    Hello ramgon,
    I think what you mean about the motivated sellers, is which motivation is the most likely to be open to a subject two deal? well motivation is motivation, that should not matter, what does matter is the power of the sub 2 it's self

    The deal is like this mr. Seller if I make you a cash offer for your house I could only offer you $78.000 but there is a way that I can offer you your full asking price of $95.000 and that would be if you would leave your mortgage on the property for two or three years, so I could get seasoned in the property and then cash you out at that point, is that something we should talk about Mr. Seller or probably not?

    Do you see the power that gives you?
    hope that helps

    Wayne

  • ramgon128030th October, 2003

    Thanks for your response wayne. What is the difference between a subject to deal and lease option. Ive heard that a subject to is always preferred by the investor.

  • raider071830th October, 2003

    Hello Gonzo,
    Say hi to my sister for me,as she lives in San Antone, As an investor you want to Buy with a sub to. and sell with a L/O that way you get into the property with no money down, and you put option in your pocket when you sell.$$$
    good luck

    Wayne

  • Lufos30th October, 2003

    Argument for the Lease Option.

    The nice seller has some very interesting tax problems and he wishes to continue to depreciate the property for awhile and may, just maybe by paying the taxes take all the deducts. Of course he might also need to hold the property for longer as he is showing it as an asset you know the enormous equity. Looks good on his statement.

    One item which is often in play, is the person leasing agrees to pay the taxes, but allows the Seller to continue to take the Tax Credit. Sort of a double win and a good card to play when negotiation starts to stall, that dumb blank stare gets in the Sellers eyes.

    "Oh all right," you say, " Tell you what, I'll pay the taxes, then not show it or deduct the payment, and let you take the deduct for the tax payment." Smiles all around, the deal closes and you move in only to find that you cannot fit the still in the bathtub. Really annoying.

    Cheers Lucius

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