utilities

[Joseph44 0]

I have a possible deal with a seller out of state. First time doing out of state deal. My contract covers about everything except, (this was never an issue till now), utilities. He wants me to take care of the lawn and pay electric bills. I will have an option on the property for 4 months. My question: should I agree to this? In my contract I have Lessee is respnsible for payment of all Utilities. I don't want to pay anything, only a few dollars to seal the deal. Or should I add this to the addendum that seller is responsible for utilities. Everyone's thoughts, please. I need this asap!! Thanks everyone and have a great day!!

[Craig 0]

Do you have a pure option or a Lease to Purchase Option?

[MichaelC 160]

Joseph, I'm confused. The answer to your question depends upon the type of deal you are structuring, and your position in it. Can you clarify, please?

[Joseph44 0]

Hi Craig,

Thanks for the reply answer to your question:I have a possible Lease

option.Thanks

[MichaelC 160]

Hi Craig,

Thanks for the reply answer to your question:I have a possible Lease

option.Thanks

A lease with an option? Are you in the middle of the deal, with the right to assign, sublet, etc? And, why only four months??

[Joseph44 0]

Hi Michael C,

Answer to your question:Would only go 1-4 months to find a

ten/buyer.This will be a sandwhich l/o with the right to assign or sublet

the home is brand new (he speculated on it).homes in area selling for

around $350,000-400,000.Our purchase price is $325,000 I plan on a

$355,000 cash or a l/o of $368,300.I'm getting of track should I pay

utilities and services.I think this will be interesting there were a lot of

speculators and there are quit a few homes for sale all on same block.

I would realy like some thoughts on this I told him I would fill out the

contract as far as I can he will fill in prop/info and send it this wk/nd.

Thanks everyone and have a great wk/nd.

[MichaelC 160]

I wouldn't touch this deal. A sandwich lease with a max of four months is going to have zero appeal for any prospective tenant/buyers. I just don't see a market for it, and I don't think you'll be able to move it as a result. Sounds to me like the owner wants it all, and at your expense and risk.

[Joseph44 0]

Hi Michael,

Michael would you please explain your reasonning for not doing this deal?If I can't get a ten/buyer in a 120 days 4-months he gets the home back,but thats not what I want.I have till Sunday evening to send

this paper work to him.If you can give me an alternitive to my above

please don't hesitate.Thanks Michael have a great wk/nd!!

[MichaelC 160]

Michael would you please explain your reasonning for not doing this deal?

Sure. What tenant/buyer is going to do a deal that requires putting down nonrefundable option money that will be lost if they don't exercise that option within a four month time frame? Just about none, in my experience.

[rpoissa 0]

Hold on, lets clarify something here. Is it

a) 1-4 months to find a TB

or

1-4 months to find a TB AND for the TB to actually buy the house outright?

 

If you find a TB in month 4, does the TB have to close in month 4, or can he rent for a year and then close?

[Joseph44 0]

Michael C & RobP,

There is a shot circut here:I have 120-4months to locate

a ten/buyer.I have a 3yr/option with 3-12month automatic extensions.

the buyer does not have to purchase in 4 months.I'll market 2 ways

$355,900 all cash or $368,300 on a l/o.Thanks I hope we are on the same page now,I will fax this agreement tonight.The only change I will

make in the contract is lessor agrees to pay all utilities and monthly rent for 3-6 months while ten/buyer is located.Thanks again and for the great responce I really appreciate the help.I'll let you know if it flies.Have a great wk!!

[TrueHardMoneyLender 0]

He wants me to take care of the lawn and pay electric bills. I will have an option on the property for 4 months. My question: should I agree to this?

 

I would say that it depends on the numbers. How much will it cost over the period of time you are likely to pay? Do you have confidence that you will recover that amount when you find a T/B? If so and you feel the profit margin is there consider agreeing to paying. Maybe reduce the price by $1,000 or what ever the estimated costs are for the utilities and the landscaping.

 

On a different level why does it matter if you put in zero cash or some cash? It is the return and the time to earn the return that should drive the decision to even go forward. If you walk from the deal because you do not want to pay the utilities but that means walking from a clear upside within 4 months I would say you have your logic backwards. If you are really not confident of finding a T/B then maybe that is an indication that the deal is not a good one in the first place independent of the negotiation point.

[Joseph44 0]

Hi,H/M/L and wellcome,

No I plan on doing this if accepted.I sent contract to him

Sunday nite.Question never was asked before about utilities.Thanks for the reply and answer.Have a great wk!!

[Joseph44 0]

Hi Everyone,

Just to update everybody:I faxed contract to seller on 5/27 he

emails me he has a potential buyer?????He said they close on their

home 6/28 he said if deal falls through he would contact me and run

with the l/o offer I submitted to him.We shall see!!!!Thanks for all the

help and all have a great day!!!