I am trying to find a place for a couple that has $10,000 for a down payment on a CA deal. A property has turned up and after a handfull of exchanges and a submitted offer by me, the seller sent this email.
Maybe I haven't explained the way the deal works and the advantages to this guy well enough but if anyone has any input on how to respond without losing the deal I would appreciate it.
Thanks, here is his reply

HEY JOHN THE ONLY WAY I CAN DO THIS DEAL IS IF THEY GIVE ME AT LEAST 4000 DLLS. FOR DOWN PAYMENT,I CAN ONLY DO THIS FOR 1 YEAR LEASE PURCHASE AND I CAN NOT DO 500 DLLS PER MONTH CREDIT I CAN DO 100 DLLS PER MONTH I WILL RUN A CREDIT REPORT FIRST FROM THEM AND I WILL NOT GIVE ANYBODY OTHER THAN MY SELF TO CONTROL THE LEASE OPCTION CONTRACT (IN OTHER WORDS IT WILL BE THEM AND ME ONLY)
IF THIS IS GOING TO WORK FOR YOU LET ME KNOW.
CARLOS

next

Let me add a little more detail,
Him $4,000 Me $6,000. Works for me.
As far as the Rent Credits comment, he obviously doesn't know how they apply even though I offered a NET purchase price to him and clearly stated that this is the dollar amount that goes into his pocket at the end of the lease. I'm thinking of leaving the rent credits part of the Short Offer Form out simply because it has confused some sellers.
In my reply should I say that the rent credits mean nothing to him whether we do 100% or 0%, his receiving purchase price will be the same.
Is it best that I call him and talk things over with him AGAIN, or should I lay out the details via email, AGAIN.
I'm not sure if this seller isn't motivated or just a little unsure.

Tony, I like your input. That works for me. What would be the best way to reply to let him know I can take or leave his house, and if he wants those rent payments to start, give me a call. I'd gladly give him a little piece of the pie if it gets this deal done this week. Keep in mind that the T/Bs are ready to go.

So you've approached him with a serious t/b about doing a CA, but he's trying to hardball you? He realizes that you're working with him and that the LO is going to be between him and the t/b, right? If he won't let you do your job without him trying to be in the captain's chair, it's going to be a huge headache for you. You obviously have a quality t/b and don't NEED him. I assume that his house isn't anything special or something that you'd have a hard time finding comparable properties.

The short offer form is supposed to used when making offers for SLO. That might be where your seller is getting confused. If you quote him a net price, but your offer is showing rent credits and option consideration he's going to get confused. Plus the short offer form says that you're responsible for maintenance only up to a certain amount. Is it possible that he's thinking that you're doing a SLO when it's actually a CA?

How did he find out that your t/b has $10k to put down? Was it included in your offer? Personally, I'd be willing to cut him in on the $10k. Maybe not $4k since you already have a t/b, but somewhere in the $2-3k I think is reasonable provided there's no other issues that he brings up. Otherwise, find someone else who happy getting their closing costs paid and a premium price for their house.



Right off the top of my head, this is probably what I'd do. I'd do like you mentioned and get back to him and offer a small piece of your take IF YOU CAN DO THE DEAL BY SAY SUNDAY. Depending on what you've told him, let him know that your t/b's like his house and would like to do the deal with the numbers you originally submitted to him, but they need to do it by whatever deadline you choose. Otherwise they'll have to go with one of the other properties you've found. By pulling back just a little, it shows that you're not desperate to take on his problem and willing give up 40% of your payday in the process.

JC, a few things come to mind. It's obvious this homeowner doesn't fully understand what you are trying to do for him. Not because you didn't explain the CA thoroughly, but because he probably hasn't been listening too well.
Let's simplify things. You can call him back, (no email for this), and try to explain his erroneous thinking and how all this benefits him. I know you've done this already, but do it again. It could be worth six grand if the light bulb goes on.
Or, you can take a harder stance and somewhat politely tell him he isn't the only house on the block and that his demands aren't acceptable. Personally, I'd opt for the former and hope to pull in the $6K.
And Brian is correct about the Short Offer Form. It's intended for making offers when you are going for a sandwich lease. That could explain the confusion for a homeowner if you are talking to him about a CA.
Hey, he's back! How've you been, Tony??

I talked with the homeowner, I gave him the "this house seems to fit the Tenant/Buyer's needs but I don't think that they will agree to those terms."
He goes on to say, "well, I will go ahead with the deal if they can pay first months rent and a down payment of $2,000."

I said "that should work, let me talk with the T/Bs and I'll get back to you."

Unfortunately, the T/Bs haven't got back to me the last 3 days? They seemed so excited and now they won't contact me. I'm giving them another 2 days and then I stop looking for a place for them.

How can I have T/Bs stay committed on a 'Reverse' CA? Should I have them sign something? I figured verbal commitments and my judgement was suffice to know how serious and motivated someone was about buying a house this way, but apparently not.

When Finding A T/B First.....

The Good
1. Saying, "I have a T/B ready to start the lease as soon as possible" makes it easy to excite a seller and get an initial commitment from them.
2. It is 100% free constructing deals this way.

The Bad
1. The T/Bs can easily 'flake out'
2. The T/Bs get picky and think I'm willing to run all over town like a R.E. Agent to help them.

The Ugly
It's all good and it's all educational, but sometimes that fire under me gets a little cold......anyone got a match?

It's hard to say what's going on. Maybe they're on vacation? Maybe they're just really busy? Maybe something has changed and they're embarrassed to say that they can't go forward with it right now.

Either way, I'd still try to get the house under contract with the terms you've described. Maybe you have to give up $2k, but it's better than walking away totally. If he's open to the idea of a LO, I wouldn't think there would be a huge problem unless he need's the house filled in the next week. If need be, maybe you can even give him $2500 when you find a new t/b.

I don't think that you can really be fool-proof when dealing with t/b's. Even if they signed something saying that they're willing and able to do a LO with whatever terms, I can't imagine how it could be enforced. Sure, it would have a psychological effect, but it can't stop them from flaking if that's what they want to do.



Don't let them do that to you! Some t/b's seem to think that we like driving around showing houses, and they'll expect you to do that if you let them. These people have to understand that we're offering them something they need. If they're going to turn down a house because it's the wrong color, then they can go to a bank. I don't say that in so many words but when a t/b balks something like my asking price (houses aren't going to appreciate 15% in 12 months!), I give them some websites to do their homework and to call me if they're still interested.

I have a lady that's interested in one of my properties right now, but she thinks that I'm going to show her the house everytime she wants to see it again. It's a 25 mile round trip for me, so I told her I'm willing to show her again if she's serious (meaning that if they can come up with the $5k I'm looking for and her husband likes the house, they're going to fill out an application) but I don't want to waste each others' time if she's just browsing.

Leave a message and then don't bother calling again, JC. Most of these folks are all talk and no walk, and won't think twice about you or your time.
Money. Collect some sort of fee. Call it what you want: locator fee, finder's fee, pain in the ass compensation fee, etc. But, if you can collect $150 or so, it just might weed out the curious from the serious.

JC,
I have sorta kinduf like the same situation, one of my T/B's that I am holding a house for had given me a personal check for over $20K (she sold her house couple of months ago, so she has the money) and I've been calling her cell for the past week to let her know that I already have another family from MD who fedwired me the cashier's check to move in, so I need to mail her check back and she's not answering her phone nor returning my calls.. she used to call me almost every day to update me on her status but she stopped calling me over 7 days ago
I need to send her check back, so I don't know what else to do.

Return it to the address shown on her check.

I've been wanting to do that for the past couple of days (certified mail) BUT I'm thinking that, that address is the house she just recently sold, so I need to play it "safe" and talk to her first

It should forward without any problems.

I'll give it another week, if nothing happens, I'll just hit the post office with an forwarding address info request, maybe she did leave one.. I know I never do, and I move around alot

That's a really good idea. You can apply it towards the option consideration if the purchase a property, but you keep it if they don't. If you're going to spend the time to actively find them a house, they should be serious.

$100, non-refundable, applied in full towards the purchase price of the home. If they disappear off the face of the earth, I collect $100 and most likely have sellers anxious to do business on other CAs. I like it!

Any ideas on how to word an official "Rent To Own Location Agreement"?

for brief limited time periods...few and far between but give me a couple of weeks and you will be glad to get rid of me