If buying a single family property for investment purposes using the conventional way, using a bank, you might have to put down 20% percent down or more, and imagine doing that multiple times, it’s possible you can run out of money quickly. How about a Lease Option as a potential investment vehicle?
In most cases you might put down 1-3%, and some instances maybe nothing depending on what you negotiate with the owner.
What is a lease option?
A lease option is an agreement that gives a renter a choice to purchase the property their renting during or at the end of the rental period, sometimes from 1 to 3 years, sometimes known as rent-to-own, depending on what you negotiated with the seller/owner. It also means that the owner cannot offer the property for sale to anyone else. … A lease option is also known as a lease with the option to purchase.
Paperwork needed : Please see your state specific attorney for paperwork.
Residential lease: legally binding contract made between a landlord and his/her tenant.
Purchase agreement: gives a tenant the right to purchase the property in accordance with the terms set in the agreement. The form must be written in accordance with all State landlord-tenant lease laws in addition to following the State’s real estate commission’s rules which typically require certain disclosures forms to be attached.
Rental Application: Used by landlord/owner to verify a tenant/buyers background including employment history, credit history and criminal record.
Book I recommend
Thank you for reading, please stay safe.