Renter/buyer who has successfully, and profitably, rented with an option to buy

General Real Estate Investing
1

All,

Do any of you know a renter/buyer who has successfully, and profitably, rented with an option to buy?

Let me know what some of the keys to success are.

Thank you.

Ryan

2

The keys to success are knowing why you want to do a lease/option in the first place.

Why?

Then, once you’ve determined why, you find a seller willing to cooperate with you.

Issue: Most lease/options are not deals, and they never become deals, and thereby remain a pipe dream.

Issue: A good (read as legitimate) lease/option is simply an agreement that gives the buyer time to qualify for financing, without some ridiculous price/time hurdle, or some other gratuitous condition that benefits only one party.

Read this thread for more information.
http://www.reiclub.com/forums/index.php/topic,57910.msg282504.html#msg282504

So, what a good lease/option looks like:

  • A good price for both parties.
  • Rent/Option credits aren’t necessary to qualify the buyer.
  • Option period is considered just an extra long escrow period.
  • Designed to give the buyer time to qualify for financing; offer debt relief to seller; and/or accommodate the seller’s tax liability.
3

How can you profitably buy something? Are they subleasing?

4
How can you profitably buy something?

I am interested in doing the following:

  • Renting a house and living in it
  • Getting the house under contract (through the option to buy)
  • Assigning the contract for a profit.
5

That seems so complicated for a few hundred bucks per month.

But maybe I don’t know what I’m talking about.

Strippers make that in two hours.

6

brymetime… If I may jump in. I think what they are saying is that what you are saying you “want to do” and the methods you are trying to get it done don’t work together.
I think you have to narrow down what you want to do first. Which seems to be… a place to live. Next is how much can you afford to pay? After that, you have to decide which method of creative financing is best for you.
The method you have chosen isn’t working for what you want to do. I am new to this but I do know that you could find an SUB2 that you can afford. I also think that you may want to look at a two-family house for a while. rent one side and you live in the other until you find another deal you can afford in a single family.

For those who know more than me, am I on the right track?

7

For successfully, and profitably rental property looks at the top things -:

Job Market: Locations with growing employment opportunities tend to attract more people – meaning more tenants.

Neighborhood:- The quality of the neighborhood in which you buy will influence both the types of tenants you attract and how often you face vacancies.

Property Taxes:- Property taxes are not standard across the board and, as an investor planning to make money from rent, you want to be aware of how much you will be losing to taxes.

Amenities:- Check the potential neighborhood for current or projected parks, malls, gyms, movie etc.

Rents:- Rental income will be the bread and butter of your rental property

Schools: Your tenants may have or be planning to have children, so they will need a place near a decent school.

Thank You

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