Lease Purchase Prospect in tow

[socharming1 0]

Here we go....

 

I found a property for LP, I have tons of forms, what is really necessary. I have your book Michael, anything in there I can use.

 

I live in VA and have all the contracts. But it is very over whelming. What do I use just to tie up the property and begin advertising for TB?

 

Thanks so much!

[MichaelC 160]

I found a property for LP, I have tons of forms, what is really necessary. I have your book Michael, anything in there I can use.

My God, I sure hope so!

Charming one, if you have my manual, you have all the forms you need. Now, let's relax, and get the deal done correctly.

Give the details of the deal, and the type of lease purchase you will be doing. Then we'll walk you through the forms and the steps needed to wrap it up.

[socharming1 0]

Asking price $439

Comps only one sold in 2002 for $300

tax roll assesses at $308,000

Rental rates $1600-$1800

 

4b/3.5 ba, fl, 3 lvls.

 

He's advertising as FSBO instead of RTO (he is selling as RTO)

He has set his own sale date at end of tax year 2005

asking rent 1645

option consid. 2195

No work needs to be done, many upgrades, move in condition.

 

I figured I'd off $412,660 (6% off top)

Offer $1645 consideration (paid by tenant buyer, I get what's left)

set my sale price at $462,660 rent for 1850

 

Don't know about rent credit tho.

 

What kind of LO you ask, Sandwich?

 

Now, on to the forms.....I have your manual in front of me....

[MichaelC 160]

A few concerns........

First, the numbers you are using are based on some rather vague comps, if I'm understanding you correctly. One sale two years ago is of no value. Nor is the tax assessors value. So, that begs the question of where is the homeowner pulling his asking price from, and are you certain you can get your asking price from a prospective tenant/buyer? Not trying to rain on your parade, charming one. Just want to be sure you're not a motivated buyer.

Having said that, your question was about the contracts. Quite simple, really. Between you and the homeowner you would complete the Residential Lease with Option to Purchase Agreement. This is one document, four pages, and can be found in the Contracts and Agreements section of the manual.

You should also complete a Memorandum of Option between you and the homeowner. This document must be notarized before being recorded. You can further opt for a Performance Mortgage, as well. Both docs will provide you with protection in the unlikely event the homeowner tries to sell the property to someone else while you have an option in place with him.

Let me know if this is clear. The contracts can be confusing at first, but are critically important.