Have You Done A Sales/Leaseback Transaction?
I made an offer on an investment property (SFR). I found a program that uses the value of the home to help get you the money you need to do the transaction. It is called The HML (Hard Money Loan) Alternative. It is a sales/leaseback program for people with less than perfect credit.
You make offer on home. YOu apply to this company "Real Estate Finance Solution" . They help people up to 75% LTV. There is a simultanious closing where you take title and immediatley give title to this company. Then they lease property back to you for one year. You fix it up and sell it or refinance it within a year, then pay them back (plus their costs) and keep the rest.
Has anyone used this company before. I would love to find out how it worked out...good or bad? I need to make a decision quick if I should use this company or not.
I can not find them searching with the BBB. They are out of Plano, TX.
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Debbie 
This one does not sound good. In the first place you cannot sell or refinance the property if title is in their name. You should not give control back to them by passing title. By keeping title you can sell it and pay back the HM Loan or you can refi it and pay it off. I do not like the idea of you fixing up a property when title is not in your name.
I suppose I need to find a hard money lender for this purchase. My offer was exepted, that is the good news. The bad news is that nobody seems to have experience with the The Alternative HML program. But, I respect you guys on this sight. Thanks for the warnings.
Sounds a bit scary to me...i found a developer that offers a leaseback at closing, where he offers 24 months or 15% of the sales price. On pre-construction he offers 12 months or 8% of the sales price.
cbrech....how would that sale leaseback work for the pre con condo for lets say the one year....can u give me a quick scenario with a sample purchase/including some basic dollar amounts...i am looking into some pre con condos with a buddy of mine, and i want to know what to expect if this is presented to me..Thank You so much
Mike
I think I may have found one of the last "investor friendly" developers. On the preconstruction offerings (Florida Keys), it is your typical 10% due at contract, these are assignable contracts (based on the developers phase increase). If you or the developer does not find a buyer of the contract, upon closing he offers a 12 month leaseback that is equal to 8% the sales price. These condo/town homes are fully furnished, so basically he turns these into a short term vacation rental to offset the leaseback he offers to us. This is a win for both the investor and developer. We are inside investors purchasing these contracts before they are offered to the public, so we are able to purchase anywhere from $50-$150 sq. f.t below comp. appraised values. With this permitting and condo docs and everything necessary to get approval for building is done more efficiently (faster in other words). Now on the leaseback, I know based on past projects i have invested in, the rental rates that will be charged will more than cover the developers initial leaseback to me other wise he would not do it, but what do I care as I have a years worth of up front payments to cover all my expenses (mortgage, taxes, insurance, HOA...). The chances of this going to this level as completion date from the time all initial contracts has been offered is 18 months, these have historically been resold 3-4 times before ever built. So I as an investor have several opportunities for an exit strategy. If the property is going to create a strong cash flow i may opt to hold, close on the property and after the leaseback expires turn it over to their onsite rental management company and take the cash flow until I make my next move.
I have attempted to invest solely in waterfront properties (well as much as my bank account will allow ) as the appreciation alone in waterfront has a proven historical track record and also around Marinas with deep water access. These have been my investing niche, and have been pleased thus far...hope that helps?