Tmartinloan

FYI you cannot get paid a mortgage broker or real estate commission unless you have a license. But it would be a good idea to share lenders and findout what lenders are allowing the T/B to use the option money towards the purchase. If anyone has a lender in FLorida allowing please let me know. Thanks Thomas Martin http://www.fhamortgageprograms.com/

Thomas, if you mean there is no guarantee that option money can be guaranteed to be part of a buyer's down payment, then you are right. That money is guaranteed, though, to be a credit towards the purchase price. The form it takes, as has been discussed here numerous times, depends upon the borrower and their lender. NOTE TO SELF OK thats right so we credit it towards the downpayment OR Subtract it from the purchase price. THanks Mike

• I am hung up over this and cannot move forward until I address the down payment/ option deposit issue. • No one seems to have a bullet proof way for the buyer to use his or her option deposit towards the purchase price. FHA GUIDLINE=To be eligible for a mortgage insured by FHA, the property must be purchased from the owner of record and transaction may not involve any sale or assignment of the sales contract. I do FHA loans everyday and I have spoken to lenders about this and I know for a fact that with FHA they will not allow any assignment money/ option deposit money collected by a 3rd party for the down payment. Some say their are lenders out there WHERE?? And will they be there when the buyer is ready to purchase? WHo KNOWS??? So I have come up with the only way I can figure to make it work. 1. Buyer signs lease 2. Buyer signs option to purchase in 12 months 3. Buyer signs contract for 100,000 - $3500 balance owed on contact 96,500 to close in 12 months 4. Seller signs CA assigning $3500 for real of option to TB. ((CHECK MADE OUT TO THE TITLE COMPANY)) Title cuts you a check for the CA. This way the bank has a check showing the money made out to title for the purchase. Any Comments are appreciated. Thomas Martin http://www.fhamortgageprograms.com/

Rosanna Yes that would be a big selling point. " look bob your not going to get equity paydown by renting, and your paying down equity 3x faster because there is No Interest on your payments"

As a mortgage broker another Idea that I came up with is this. Here are the documents and steps I would take. T/B signs the following documents 1. T/B signes Coopertive Assignment- Example 4% check made out to the title company. 2. T/B signes Lease for 1 year 3. T/B signes Option for one year say 100,000 - 4000 or 4% 4. T/B signes Sales Contract to close in 1 year,Contract reads 100,000 - $4000 Contract reads Balance owed on contact is 96,000 5. Seller signs Affidavit not to take out anymore liens on the home while under contact to sell. WIth the sales contract between buyer and seller for 100,000 - 4000 depost check made out to the title company 4% the title comapny can then cut me a check 4000- prelime title and cost of having the buyer and seller meet in the title office to re sign docs for the assignment of Lease/ OPtion. THis way title company can do a title search for the T/B make sure if the option is for 100k that he owes less thank 100k and seller can excersie his option. And I would pay the title company for a prelim title search have buyer and seller meet at the title company to executed all documents.. I was also thinking of having a 3rd party escrow company recieve the T/B rent to ensure them that the Seller is making the payments to the mortgage company. I think it would give the T/b more confidence knowing a third party was collecting and making the payments and they dont have to worry about a foreclosure because seller is not making payments. ANd when the buyer goes to exsercise his or her option the bank will see the depoist made out to title. Not having done this yet I think this would be the best way to get the buyers OPTION/ Downpayment counted towards the purchase price and create value by hiring an esrow company, doing title search ect. Any thoughts? Thanks Thomas Martin

With So many foreclosures I think it would be highly unlikely that the lender would exercise the due on sale clause, as long as the payments are on time. Thomas Martin

HYPOTHETICAL EXAMPLE Just say I find a seller willing to sell for $100,000 and I find a TB and do a CA for $105,000 1. I collect $5000, Seller agrees to $200 rent credit towards to purchase. 2. In one year the buyer has $5000 + $2400 in rent credit totaling $7400 towards the purchase. 3. Buyer is ready to exercise his option and gets approved for the an FHA loan. 4. FHA Appraiser goes out and the property now appraises for $90,000. and he cannot get a loan. Now What? I know I got paid that's great and all, but am I liable to anyone? What do I suggest to the T/B and the seller? I'm sure this has really happened to a few of you how do you handle this situation? I appreciate any input. Thanks Thomas Martin

Have you ever used this as a selling point when dealing with a T/B? At anytime during the lease agreement you may purchase or sell the home for more than your option price and profit. Does you option state the T/b can purchase or sell the home at any point within the option period to pay off the seller for a profit? what do you think about this concept as a selling point for the T/B? Thanks THomas http://www.fhamortgageprograms.com/

That makes sense thanks

what type of loans are you qualifying your buyers for Conventional?

I was speaking to a few FHA lenders about rent credit and came up with an idea and wanted some feedback. Right now under FHA guidliness if the seller gives the buyer rent credit it will only count towards the downpayment if its above the market value for rents. For example if your charging 1000 per month and giving 200 rent credit then an FHA appriaser must state the market value for rents is 800 per month. THe FHA appriaser must take two recent sales and two listings to determine the market rent. Rather than crediting the rent towards the purchase price. Maybe have verbage in the contract that credits the rent credit towards the purchase price. SO of example a lease option for 100,000 and the buyer is credited 200 per month, 12 at the end of the year the buyer would have 2400 in rent credit. You option could say seller aggrees to execute new contract at the end of the lease crediting buyer 200 per month when T/b decides to excersie her or his option to purchase.. In this example the buyer would now to purchasing the home for 100,000- 2400 in rent credit = $97,600 purchase price. Any thoughts? I think the rent credit is a real incentive for a T/b to purchase the home and I was looking for a way to make this happen. Thanks THomas http://www.fhamortgageprograms.com/

Hey Tom I have thought about taking over foreclosures, if I can get the deed. Then bring the mortgage current and offer owner financing. The key would be to find homes with enough equity. Thomas Martin 911loan@gmail.com

The seller doesn't have the right to sell the house to a third party after entering a lease option agreement. They have an obligation to sell it to the t/b should the t/b exercise their option. In fact, there would likely be a Memo recorded to prevent just such an occurence by an unscrupulous seller. What woulld that memo look like? thanks

Eric can you help out with Non Exslusive verbage on a LO if the property is already listed with a realtor? How would you word you LO aggreement? thanks THomas Martin 911loan@gmail.com

What about collecting the entire option fee upfront and giving the realtor the entire commission on the sale when the buyer exercises the option? Why wouldn't this work? Win, WIn, Win, Thomas Martin 911Loan@gmail.com

Steve that is a good bullet to explain to T/B Thanks

I am going to try going after porperties to CA listed by realtors. I am wondering what the best verbage to add to the short contract " Residential Lease and Option to purchase aggreement" that would make the aggreement non exclusive? How does this sound, " This option contract is non exclusive, seller can list and sell with realtor at any time and is not bound to the aggreement"? Can someone help me out here? thank you Thomas Martin 911loan@gmail.com

Have the option consideration check from the tenant-buyer made out to a Title Company. And then have the Title Company cut you a check after you assign the lease option agreement. That way, you can prove to the bank that the option consideration money went to a Title Company & was cashed. Finally, look at this scenario... A seller lease options their property to a tenant-buyer. The original seller decides to sell their house and assigns the lease option to the new buyer. The tenant-buyer stays in the house - nothing changes for them except for who they send their rent to. The tenant-buyer then gets their credit fixed, gets approved for a mortgage, exercises their option and buys the house. Would any bank say that the tenant-buyer's option money paid to the original seller was no longer valid because the original seller sold the house? Probably not. I don't know if I explained that well enough, but just think about what happens when a lease option property gets sold and the lease option agreements get transferred to the new owner. That is really all that is happening. Good POINT! So get my T/B to make the check out to a title company and then sign all lease aggreements at the title company and then get the documents notorized. Thanks a great idea. Thanks Thomas Martin

Well we all want to give our tenant buyers confidence that the seller is going to make timely payments. Would it be a good idea to have the seller sign a authorization to release information to the T/b can call the bank and make sure the rent payments are being applied to the mortgage? Or at 9th hour at the closing table get the seller sign an affidavit stating that they will apply all rent payments to the mortgage? Any thoughts? Thanks Thomas Martin 911loan@gmail.com

What would happen if the seller decided not to make the mortgage payment, I collected the Non refundable option deposit to purchase. This is happening alot in FLorida, would the T/b come after me? Would I have any liablility? How do i protect myself? thank you

As a CA/ property manager locating motivated sellers willing to allow me to assign a lease option on their home. DO I have any liability collecting a non refundable option fee if the seller decides not to make the mortgage payment? How am I protected if at all? Thank you,

I dont understand how is assigning the contract for a 3% option fee?? For FHA the buyer still needs to come up with a req 3.5% downpayment in order the purchase the house?? please explain how they apply an option deposit towards the purchase? thanks

Just say you do a Cooperative assignment and collect a 3.5% non refundable option deposit money and assign you contract to a T/b. The T/b will then need another 3.5% down payment to purchase the home with FHA financing. The option deposit of 3.5% is just that option money and cannot used for the down payment. The buyer would then have to come up with another 3.5% to purchase the home. Any ideas on how to use the assignment money as the down payment? Or the best way to structure a lease option with the anticipation for FHA financing? Any ideas are appreciated? Only other Idea I has is that if you were a realtor you could collect 3.5% upfront as a commission. Thank you Thomas Martin 911loan@gmail.com

Nomally they want to sell anyway So most people are open to listening to what you have to say.

How much does John charge? Does he split the non refundable deposit with the realtors or does he take the non refundable deposit plus the first months rent? Or do the realtors only get paid when the house sells? thanks