simple FAQ on CA

[DanielSun 7]

As expected, I always get asked this question by FSBO when trying to do a CA, "what if it doesn't sell at the end of 1 year" or "what if the market drops and the buyer doesn't want to buy anymore" or "what guarantee do I have that the tenant buyers will buy"

 

I still don't have a good answer for those questions for a CA agreement. I wasn't going to tell them that they will pay a small down to me, I mentioned that we give them rent credit so they stay in the deal, I mention that we screen our tenant to make sure they are buyers, but usually the sellers are not convinced. that's the number 1 blocking question for me. any good answer to those questions? i know it's a very basic question.

 

FRBO on the other hand, are a lot easier. I kinda prefer them now.

[MichaelC 160]

Common concerns from homeowners, easy answers from us. . .

"If the tenant/buyer doesn't exercise their option, Mr. Homeowner, you have several choices at your disposal.

1) If they want to buy but need more time, assuming they have been good tenants, (timely rent payments and have maintained the property), you can extend them for an agreed to period of time.

2) If they are vacating, we can assist you with another Rent-To-Own.

3) You might decide that being a landlord isn't so bad and opt to offer your property as a traditional rental.

4) You may decide you want to sell and go with a Realtor."

 

Something along those lines should suffice for most homeowners. If the homeowner is looking for a guarantee that the t/b will buy, be honest and tell them you can't guarantee that. It is, after all, a lease with an option. You can tilt the odds in favor of a purchase with a careful screening of the t/b and by guiding them to a mortgage broker early on. But you cannot and should not make any guarantees.

[DanielSun 7]

Thanks Michael.

I guess it all depends on how motivated they are.