Thread: House not selling? Buyer can't get financed?

I had a problem with a house not appraising one time for what the buyers needed because they were rolling their closing costs into their loan. The seller eventually had to bring some money to closing.

The Lease With Option solves that problem.
YTour Buyer could lease for a year or two and hopefully the balue of the house would go up. Plus, when seeking a mortgage, you might be able to get a loan as a "Refinance" instead of a "Purchase'. This could save mopney in several different ways. Another idea I have seen when using the lease with option tecnique is that the Seller gives up his equity build-up in return for the on time lease payments. In other words, his mortgage goes down a little while the house goes up a little. That difference (equity if the owner was keeping the house) would go towards the purchase.
Beleive me, the Lease With option solves a multitude of problems.

The key with a lease option is getting an attorney to represent you, not the other party. Also knowing the local real estate market so you can make sure you are not overpaying is essential.

There are advantages but also risks, just like any major financial decision. Failure to educate yourself may lead to problems.

You are right. There are risks. That is why we specialize in the field and we are the only ones that I know that concentrate in this area to help Realtors out.
We have a contract that is a boiler plate and we just add the different information (names, price, addresses, etc.) but the contract is basically the same all the time.
Remember what you learned in any investor courses you took: use a cookie cutter (Over and Over and Over). This cuts out the mistakes.
Shoot me an e-mail and we will gladly give you free advice.
If you are a Realtor and noit using the Lease With option for lost listings and other situations, you are throwing money away.

Considering the vast differences from one state to the next I would not want to use a generic contracts from the internet. Since I am not an attorney, I again suggest obtaining the advice of a real estate attorney in your state before considering a lease option.

If a buyer has bad credit now, the odds are they will have bad credit 2 years from now. For most people with bad credit it is a way of life. I know there are exceptions, but how is a seller to know if this buyer is one of the exceptions?

Don't believe me? Turn on the TV.

The risks for both the buyer/renter and the seller are very high. Very risky and if not done correctly and according to the laws in your state....

Because I do these for a living, I will answer a few of the questions that have arisen.
First, someone said that they would not trust a contract they got off the internet. ASbsolutely correct. I only do these in new York State (we are getting readuy to do others also). I had one of the top Real Estate Attorneys in upstate new Yoprk draw the Lease With Option contract. I keep everything the same and now just plug in the different names, prices and addresses. Never had a problem with the contract. It is a straight lease with ONE paragraph dedicated to the Option. Because we are getting ready to go into other states, we are going to do another contract for two states we are looking at. We will have a straight lease with no mention of an option at all. Then we will have a secon contract that will be the option. That will settle all problems in those two states. A Lawyer is drawing up separate leases for each state. Then that will be our "cookie cutter".
Second, a few people said that people with bad credit now may still have bad credit later on. We simply do not deal with people that will have no chance of qualifying for a mortgage. I make money also when they get a mortgage. I certainlt do not want to waste two years with someone who is not going to get a mortgage. The people we deal with have many reasons why they can not get a mortgage NOW. Wher I live, upstate NY, it seems like every gas station, grocery store, pizza parlor, etc. is run by recent immigrants. They deal in all cash businesses. Yet their wives want a nice home inb a nice school district just like all Americans. We work with them to get credit cards, get a car loan on their cars they own free and clear, then deposit their car loan proceeds into a few bank accounts and lastly borrow against those accounts. Within a year, they have credit.
We deal with people in litigation where their Attorneys tell them NO TO BUY ANYTHING until the case settles. This could be nasty divorces or nasty business litigation amongs partners. The list goes on and on!
If they can not get a mortgage within two years, we pass on them.

I hope I answered a few questions. If you are not using the Lease With Option, you are leaving money on the table.