MichaelC

Paragraph 20 is referring to canceling the agreement before the lease start date. Paragraph 21 refers to canceling to the agreement after the lease has taken affect. For example, your t/b vacates in month 4 of a 24 month lease and you are unable to find another t/b, thereby putting you on the hook for the remaining months payments. But this clause limits you liability to an amount equal to one month's rent.

The number of months in the deal is between you and the homeowner. If you've agreed to a 12 month term, then that's what the t/b has.

Which specific "term" are you referring to? The start date? If so, be realistic about that. If I'm doing a deal today, assuming the property is highly unusual I would expect to have a t/b ready to go by November 1, maybe November 15th. If something happens sooner, great. The homeowner will be happy. If a t/b can't take possession until, say, December 1, adjust the agreement to reflect that. Remember, you have the right to cancel at anytime, for any reason, as per Paragraph 8 on the CA Residential Lease agreement. On a CA? No. You complete the CA Assignment Agreement. Be certain you are using the correct agreements for the type of deal you are doing, and be certain they are filled in correctly!

Mike, deal one appears to be a solid choice for a sandwich lease, assuming those numbers are accurate. What's the length of the deal? Deal two may work as a CA as long as that payment is current. You do not want to be involved in it if the homeowner is behind on payments. That's an invitation to trouble. What's the expected rent, and what length of lease is homeowner willing to do?

Mike, fill in the amount that you are paying the homeowner, (typically a buck or five), to make the option legally binding. The amount of option consideration you receive will be reflected on the CA Assignment Agreement.

Chris makes a good point. Tailor any give aways or gifts to your audience. If I'm a homebuyer, I'd probably want something for the home. Find a bargain on an appliance or electronic gizmo.

Hard work? Nah. Laying blacktop in south Florida in July is hard work. This stuff we do is like stealing candy from a baby.

First, confirm with this woman who is now the actual owner on title. If it's another individual she transferred title to, you'll need to do business with that individual. I'm not familiar with the specifics of IL law, but if title is in the name of a trust, you should talk with someone, a lawyer or a title company, to ask how your transaction should be approached.

Daniel, I've always believed there are only two reasons why a property can't attract a buyer or a t/b. Either your marketing is inadequate, or your terms are being rejected. I'm guessing the latter, since this condo has already been on the market and I'm assuming the Realtor used his/her access to the various marketing tools that Agents will use. The right (bargain) price will make at least one buyer willing to overlook the drawbacks.

Jay, I agree. A lease option is definitely a better deal for the homeowner. If something goes astray, he's dealing with a simple eviction of his tenant, as opposed to a possible foreclosure action against his buyer.

Jay, I agree with Steve. And this is one of those times when it might be the prudent thing to speak with an investor friendly attorney, (one who is a member of a local REIC?), and explain what you're trying to do. There's a potential for a nice payday and you don't want a paperwork technicality to screw things up.

Jay, a Pure Option can be used when the homeowner is willing to deal with you but has no interest in any type of lease arrangement. You simply have an option to purchase for an agreed to price for an agreed to time frame. The simplest way to do this is to negotiate the lowest price you can for the longest period of time. I understand that some folks preach about assigning it back to the seller. I don't, and for the life of me I can't understand why anyone would. Let's look at an example of a Pure Option deal: You negotiate with the homeowner an option price of $200K, for 60 days. You're out a buck or five for that privilege. You agreed to that price because your homework has you convinced the fair market value is around $235K. That's $35K in potential equity. The question now becomes how much will someone be willing to pay you for that equity? Perhaps an investor comes along and decides your deal is worth $5K and agrees to pay you that as an assignment fee. You collect your fee, he replaces you in the deal, goes on to close with the homeowner, and in the meantime you are long gone and out of the loop. That's one example, and the most straightforward approach.

Homeowners always overvalue the work they've done. Unfortunately, what they usually fail to accept is that a $300 plumbing upgrade doesn't equate to a $10K increase in value. Best bet is to walk from this one, but check out this gent's other properties.

Tom, there aren't any options available if the terms aren't realistic. The fact that he dropped his price $30K just like that tells you he knows he is dreaming about the price. Did you ask for his sales data?

Tom, tell the owner that the sales data you looked at doesn't support his asking price. Take a "I'm sure it's me" approach, and ask him where you are going wrong and request to see his sales data. In other words, make him justify his asking price. I suspect he won't be able to, based on what you wrote above. If I'm correct, it serves no purpose to take on the deal when it is so overpriced.

Are they both in agreement about her being removed from the lease? Is the rent current? If so, re-do the lease between you and your t/b to reflect the current situation.

Mike, in addition to what Steve wrote, I make all prospective tenant/buyers drive by the property before I agree to meet them there. If they don't like the neighborhood or the outside, they won't call back and I'll be spared a worthless trip to the property. Helps weed out the curious from the serious.

I agree. No harm in spreading the word, everywhere, anywhere, and to everyone.

Charles, the problem I see is that, down here in the US at least, a return of less than 6% isn't going to attract much attention. With the stock market blazing and with many real estate markets down here heating up, I suspect many US based investors will stay local where they are more comfortable and can in all likelihood earn a greater return. This deal might be one for you to shop locally.

Daniel, the investors I know that successfully market via bandit signs do so in a big way. Big numbers of signs, 100-150, (not 2 dozen like most of us), over large areas and are persistent. A slow response rate is met with even more aggressive sign marketing. It's not for everyone, but that's what it takes for signs to generate a few serious leads.

You're correct, Lynn. There are pros and cons: bigger payday, but it'll take longer to get there.

Hello, Daniel! Long time. Hope all is well up your way. The price of the property doesn't matter. What matters is whether or not there is value being offered. From your description it sounds like there is. So it comes down to marketing aggressively. Advertise in the area and other areas, as well. Why not? Signs, online ads, word of mouth, contact the HR departments of any large companies in the area. They sometimes have employees transferring and offer relocation assistance. Get creative. It's a $35K payday. That'll buy a lot of snowshoes and parkas.

Hahahaa! I lobbed you a softball and you hit it out of the park!

Nothing technology related surprises me any more. Smart phones, tablets, phablets, etc. We can connect to anybody, anywhere, anytime. Hell, just ask President-in-training, Anthony Weiner.

Backpage.com and ebayclassifieds are free, as is Postlets.com. Might as well include them in your marketing. Sellpoint.com charges a fee, but might be worth checking out.