Best Way To To Set-up Credits For Future
Hi all,
First post. NEWBIE!! Already have my first deal in Ohio. Lawyer has drawn up the rent and option contracts and we're signing this week.
I don't feel that I've properly addressed the issue of helping my tenant-buyers secure financing in the future.
I've thought of escrowing the option payment and rent credits. Is that the most sure-fire way? I'd like to set this first deal up so that the t/b has everything in their favor if they decide to purchase.
Thanks in advance!
I would suggest you start working with a lender now, so they can tell you what condition your tenant buyer's credit is in, and what it will take to refinance them into the home. I don't do this, nor have I heard of a need to escrow the option payment or rent credits, as this simply comes off the purchase price. If the house is priced right, your tanant buyer will have plenty of equity on the day to refinance, between appreciation, the option payment and rent credits, not to mention any improvements they may do. Perhaps take that option payment (if it's nonrefundable) and roll it into your next L/O deal! Congratulations on your first deal!