Lease Option - Help, Help, Help!!
Hello all,
I'm a newbie at this and today I just called my first ad. for a rent to own. They are only willing to sign a lease for one year and if everything goes well, they'll go out another 3 yrs. Does this sound ok? Also, she kept asking me "who is this for?" I'm meeting with her this Sat, so should I tell her I'm subleasing it? What if she won't allow that?
As I mentioned, I'm meeting with them at the house Sat and have no idea what to do when we sit down to do paperwork. After negotiating the contract do I need to file it anywhere? With a bank, govt. etc.? I've also heard these documents should be noterized. How? Am I supposed to bring a notary to the signing? Also, exactly what kind of paperwork should I bring with me. A lease option contract, Sublease contract? what else? Also, how do you actually close a deal like this? Are we supposed to have lawyers there, or bankers or title company???
Sorry for all the questions but I've never done this before and I'm freaking out!! Any help would be most appreciated.
Robert :-o
[ Edited by JohnLocke on Date 03/24/2004 ]
Wow. Well, first off you probably should have let her know that you are an investor and that in order for you to make her payments you are going to "put somebody in the house". You have to make sure that's okay with her because she is the owner; You are just gaining control of the property with the right to sublease it.
She may be a little turned off when you finally tell her that you're an investor, but if she's really motivated she shouldn't care as long as you can guarantee her payments. If not, NEXT! Good luck!
The key I think, is to stress that "you are guaranteeing her payments", regardless. You take the risk of a vacancy, problems, etc. This should be something that is comforting to her, and a key selling point in her lease optioning it to you, the professional investor, rather than anyone off the street. Make your forms professional and look/act like you've done this before. Good luck!
Don't worry about your not knowing everything. Your not knowing anything may work in your advantage as the seller thinks she has the upper hand and is trying to take advantage of you. Let her feel that way. Let her talk herself into the deal. Good luck and let us know how it turns out.
[addsig]
Hello Robert,
Congratulations on getting out there and finding deals...that's more than many on this board have done with more knowledge than you so be proud of yourself.
I'd recommend finding a good book or two on investing to help you with many of your questions. One could type several pages just answering two of your questions. However, don't let that stop you getting out there and making deals...there's no better teacher than experience.
Good luck!
Thank you everyone for your kind thoughts and encouragement. The meeting is still on for this Sat and I have been doing quite a bit of reading on how options work. I've also been looking at the Carlton Sheets course.
I guess my biggest worry, to narrow it down is not so much the actual negotiation but how, exactly do we go about filling out the paperwork? Do we fill out the option contract right there and then and then have an attorney look at it next week?
Thanks
Robert
There are many forms available. I just purchased a course from Wendly Patton but have onlyhad it a few days i heard her speak and I think it will be good. do a web search for forms etc or look hers up. good luck!
Good Advice, nice to see an investor so close! Robert, private message me. Maybe we can talk, how's Palm Coast. Stil any lots for 6K? Haha! Just kidding.
Lance
Hey Robert
Congratultions!!! The learning curve goes way up when you get out there.
I'm in Ca. and I used the Sheets LO form verbatum. Now that I am heading to court to enforce it, I've found there is a state form that may have avoided the legal action. I have my atty telling me its valid, and the title company atty is willing to testify for us to its validity, but it will be expensive.
I did not have the signatures notorized so I could not record it, my mistake, but that did not invalidate the contract just stopped me from recording the LO. I think it should be recorded because then she cant sell out from under you since the title is clouded. Have a local atty look over your form first to validate it for your area. Make sure you can sublease. Last but not least, make sure its a good deal for YOU or walk, there are more to choose from, better no deal than a BAD deal. Good Luck!!
WELL I Have to agrree with some of the comments here that are
highly advising you to get some knowledge first BUT by all means DON'T let that stop youi cause
if and i say IF the lady is not doing this as an investment type of deal like you are then it's probabley safe to bet that you know alot more then her just by the education you get on the boards
like the one here at www.thecreativeinvestor.com.
by the way.......
I Would give all 10 thumbs up that i have on the LEASE OPTION COURSE that was referred to you from one of the other responces. I Can personally tell you that i know her and her course very well as i have it and speak to Wendy often about the subject of lease option and she is one of the BEST If not the BEST out there.
Last thing i would like to offer you is my Mentorship Program thst is geared on doing lease option/purchase deals and it's 6 months worth of one on one phone consults once a week for an hour and unlimited e-mails Q & A wth answers with in the first 24hours of your question. ALSO MOST IMPORTANT I GIVE YOU ABOUT 500 DIFFERENT CONTRACTS THAT YOU COULD USE TO DO JUST EVERY TYPE OF DEAL FOR ANY YTPE OF CREATIVE FINANCE DEAL THAT THERE IS TO DO OUT THERE.. YOU'LL HAVE THE BEST DAMM CONTRACTS WITH THE BEST COACH , but first
............ WARNING ............................
IF You are not very motivated in making and average of $30 K PER DEAL then this is not for you
ALSO PLEASE ASK AROUND BEFORE YOU BUY CARLATON SHEETS .
WOW!! YOU ARE NEW WHEN YOU MENTION THAT YOUR WANTING HIS COURSE THAT GIVES IT AWAY EVERY TIME. The reason i say that is cause like sooooo many other investors on this site and others i have spent about $30 k in course material on investing with creative financing in addition i went to seminars and bootcamps etc. AND I Can tell you that his course will only leave you high and dry , right back here
asking questions every day . anyway
if you want some free advice on this deal i will be more then happy to give it to you for free just to show you what you'll have to look forwaed to if you do sign up with my "Mentorship Program" my number is 561-577-1032 Ed Fulmer
Zippy Homes LLC. 8-) "Mentorship Program"
Hello everyone,
Well everything turned out to be a false alarm. I called the lady yesterday before going over to make sure we were still on and she asked me if I was an investor. I told her I was and that I planned on sub-leasing the property. Before I could go any further she told me they were not interested in subleasing so everything was called off. Glad I contacted her before I went to see the property. Oh well, maybe its for the best as I can now continue with my studies of REI.
Ed, thanks for the offer but there is no way I could afford a mentorship program. I don't have hundreds of $ right now let alone thousands. What I'd really love is to just be able to tag along with some one on a deal from start (calling the first ad's) to finish (getting the T/B in). I would just need to see done one time but I bet that would cost a small fortune.
I'll probably do what Smartlace suggested and get Wendy Patton's course. I saw it on sale here for $99. I've heard she's pretty good. Anybody else ever see any of her stuff? Is it any good?
Thanks again
Robert