I downloaded Bill Gatten’s e-book on foreclosures, and it sorta scared the bejesus out of me, cause for me, it reads like stereo instructions. Made me realize how much I just dont know or understand.
When he gets into the meat of the deal, getting the ihouse from the home-owner, he talks about getting the “option”.
Is this just another way of saying, ‘getting the house under contract’?
i am not a pro but i have read about options. this is where the seller has the “option” to buy the house for a certain price by a certain time. the seller can not back out of the deal but the seller can. for the deal to de in good consideration an option fee must be paid to the seller and it is usually nonrefundable.
Does he talk about purchasing the house on an OPTION?? like a “Sub 2” deal or something like that?
An option is an option to purchase the house, In a forclosure, its typicaly a Sub 2 option. Which means, Purchasing the house SUBJECT 2 the existing Mortgage. So for example;
You find a foreclosure property, typicaly in PRE stages.
The seller is 2 months behind on their mortgage payments.
What you as the investor might doo, is bring the mortgage current to stop the foreclosure. Than take over their mortgage in a SUB 2 option. Meaning you get the deed on the house Sub 2 the sellers existing mortgage!!
Hope this makes since!!!
::)How do you locate pre-foreclosures? Owner willing to deal with you with a lease option.
You can find foreclosures in many places. You can find them in your local paper. Under Public Notices. You can subscribe to many foreclosure websites. You can go to your county registrars office and get them there.
When you dealing with L/O’s your going to want to know how to find the motivated sellers. Someone who just wants out for one reason or another. Typically in my neck of the woods I find these deals when people who own houses for rental properties who just want out of the whole landlord career. Another might be someone moving or relocating due to their job…
Hope this makes a little since… let me know if I can help!!
a good exampple of an option would be this:
Let’s say you found a luxury home worth $500,000.
You purchase an option to buy the home at $425,000 anytime within the next 90 days.
On Day 47, you find a buyer who will pay the full $500,000.
You cash in your option, pay the seller $425,000 … and keep the remaining $75,000.
the option gives you a right to buy and sell the property also its legal you control the property
Anyone have a link to an option contract?
Of course I would make changes, but looking for a standard one.
you could try carleton sheet’s real estate forms portfolio.
hope that helps…
thanks, I will go and check that now
If you guys have any other questions on options, just ask.
P.S. Just options, I am not very good at lease options.