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This is a terrific and
typical sandwich lease that was put together by one of my students in
Colorado. It was Marie’s first deal. She found it by making a few phone
calls to FSBO ads.
The property was sitting vacant for a few months and the homeowner was
anxious and motivated, to say the least.
It was a newer house in a very popular subdivision. The owner was asking
$1800 per month for rent, and a purchase price of $348,000. In the end she
accepted $1700 per month and a purchase price of $308,000………...with
absolutely nothing down. In addition, we protected ourselves by arranging a
two month lead time before we had any payments due, and on top of that we
had a forty five day cancellation clause if we needed it.
We then went to work marketing the property as a Rent to Own. It took about
three weeks, but we found our tenant/buyer. A married couple with a few kids
looking to get into this specific neighborhood and school district.
They put down $8000 option money, agreed to $1800 per month, and a purchase
price of $339,000.
A great first deal for Marie, and a deal I’ll take every time: $8000 upfront
profit, $100 per month cash flow, and potential backend profit if the option
is exercised. All with no money out of pocket!
Controlling properties through lease purchasing is smart real estate!
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