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Dmcdonald

Seller looking to occupy his own home..?

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Hello all! I'm back with a doozy. I went trolling for wholesalers to try and get their "junk" leads that work for Lease Option but not so well for wholesaling. I got a bite with a deal in the works! The catch is that the seller is selling for a wholesale price but wants to stay in the house :lol: , renting it from the new owner for a few years then buy it back for almost 30% more (it's a very low priced home...). The wholesaler thought of my remarkable ability to make rent-to-own magic and shot me an email. Unfortunately, I'm not 100% sure as to how to approach this and to protect my interest as well.

 

Here is what I'm thinking, and please correct if wrong and don't be afraid to offer better suggestions:

  • Sign an option to purchase with the wholesaler (whom already has a standard P&S agreement with the seller)
  • Market for an investor for a slightly higher price (this will be the profit as I will not get option consideration)
  • Have investor and current owner sign the Lease Option paperwork at closing
  • Do a triple closing where the investor pays me, i take my fee, wholesaler takes their fee, and seller gets their money

 

The other and obviously SIMPLER option would to either act as a consultant or somehow get on the wholesaler's contract with instructions to the title company to split the profits (or something like that)

 

Please advise! Thanks!

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What a tangled web you weave, Mac. Will the wholesaler actually be purchasing the property and taking title? Or is he looking to, well, wholesale it and flip to a third party?

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What a tangled web you weave, Mac. Will the wholesaler actually be purchasing the property and taking title? Or is he looking to, well, wholesale it and flip to a third party?

 

They are looking to assign the contract it looks like.

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If he is going to assign the contract to a third party, then that party would have to agree to allow the present owner to remain as the tenant. That's a potential problem, no? Is he selling at a discounted price because he's in arrears? If so, and he can't pay the bank, what makes anyone think he will be making timely payments to the new owner?

More importantly, where's the money in this deal for you?

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If he is going to assign the contract to a third party, then that party would have to agree to allow the present owner to remain as the tenant. That's a potential problem, no? Is he selling at a discounted price because he's in arrears? If so, and he can't pay the bank, what makes anyone think he will be making timely payments to the new owner?

More importantly, where's the money in this deal for you?

 

My profit will either be the splitting of the wholesale profit or adding my own wholesale profit atop what's already there (there appears to be enough wiggle room).

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For me, the question I would ask myself is whether or not there's enough money in the deal to go through all the trouble required to make it fly.

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