Real Estate Information

Various Aspects Of The Lease Purchase Business


In a previous article, we wrote why we believe that Lease Purchasing is the perfect home-based business, here we want to briefly touch on some of the actual aspects of operating such a business, the pluses and minuses and why Lease Purchasing represents a win-win situation for the seller, the tenant/buyer and just as importantly, you, as the business owner.

One of your goals in operating a Lease Purchase business is to contract for property that you then move to the tenant/buyer. There are a number of unique strategies that can be employed to reach this end.

You can lease purchase the property and then sub-lease to a tenant/buyer. In this strategy, you are taking on the responsibility for all payments to the seller. However, it also affords you great profit potential. You can collect money up front as option consideration, you receive the positive cash flow and you can make additional money at the end if the option is exercised. For those of you not familiar with the term positive cash flow, this is the difference between what the tenant/buyer pays you and what you pay to the original seller. This is also known as a sandwich lease purchase.

Another unique strategy is called the co-operative assignment. Here, you contract for a property and assign or sell that contract to a tenant/buyer, with the approval of the seller. In other words, the owner/seller has final approval over who goes into the home.

Another way of doing business is the straight assignment. Here, you contract for a property and assign or sell that contract to a tenant/buyer. This method does not require a seller's approval.

You can also take a pure option on a property which allows you to purchase the home at a future date with set terms. This option can then be sold to another investor.

As you can see, there are a number of unique strategies that can be employed in this business. We have touched on just some of them to give you an idea of the type of income Lease Purchasing can generate for you.

After you've gained experience in the business, you can start consulting with sellers and tenant/buyers. There are many reasons you may want to consult with a seller rather than get directly involved in the deal. The property may be to distant to work conveniently, there may not be enough money in it for you to receive what you need, or the seller may prefer to do it him or herself.

When you consult with a seller, you are providing the proper contract, a marketing plan and supporting material. We also provide a period of time for follow-up questions.

You can also consult with tenant/buyers. You may want to do this with those individuals who have limited funds available to get into a rent to own home. There are also occasions where people just prefer to do their own house hunting.

We've really just touched on the various ways to generate income with a Lease Purchase business. Lease Purchasing allows you to develop multiple income streams. By utilizing all of the income generating strategies available to you, you can build a very solid financial base for yourself.

We've covered many of the pluses of Lease Purchasing as a business, but we'd be less than honest not to point out some of the minuses.

If you're the type of individual who has poor attention to detail, this may not be for you. You need to be able to keep good records of whom you spoke to and do business with.

Also, if you're an impatient type and don't like to do "hand holding", again this may not be for you. There are many deals where you will need to be able to walk the participants through and provide constant reinforcement to them.

Although the risk level in this business is minimal, there are some risks involved. You may contract for a property and not move it for example. If you're adverse to any risk, re-think Lease Purchasing as a business for you.

In our opinion, Lease Purchasing provides a truly win-win scenario for all parties. You get to help a seller who has a problem, you provide a nice home in a nice area for the tenant/buyer that they can get into today and buy tomorrow and finally, you are generating a wonderful income for yourself. This is a business that can be operated anywhere there are free property rights.

Believe us when we say that Lease Purchasing is the best business we will ever own. It's that good!

Copyright 2000, DeFiore Enterprises

Interested in having your own successful, home based creative real estate investing business? Chuck and Sue have been helping folks start successful home based businesses for over 19 years, and we can help you too! To see how, visit http://www.homebusinesssolutions.com for the latest FREE tips and tricks, educational products and coaching in creative real estate investing and home based businesses. No time to visit the site? Subscribe to our "how to" Home Business Solutions Digest, it's like having your own personal coach: mailto:subscribeHBS@homebusinesssolutions.com


MORE RESOURCES:

Press-Enterprise

RIVERSIDE: Reinvention turns key for Murray Real Estate
Press-Enterprise
In January, Murray leased 3,800 square feet of space in Appian Escrow Building, 3771 Arlington Ave., Riverside. Murray Real Estate is going to operate an “independently independent” business sans franchise fees. Real estate agents are being selected to ...
5 Reasons Why Community Pages Are a Must for Real Estate WebsitesRisMedia.com (press release)
4 questions to ask before choosing a real estate agentChicago Tribune
Featured Gay Real Estate Agent: Geoff Hartle, Toronto, Ontario, CanadaGayapolis

all 4 news articles »


lehighvalleylive.com

Marine mortgage broker, first responders' wives to offer real estate discounts ...
lehighvalleylive.com
When Bethlehem mortgage broker Samuel Royer heard about the Homes for Heroes program that gives discounted real estate services to first responders, teachers and those in the military, the Marine knew he wanted to take part. But he wanted to do more ...

and more »


Good signs for Vt. real estate market
Barre Montpelier Times Argus
The Vermont real estate market continues to show positive signs of a rebound, after one of the most difficult periods in its history. Experts expect that trend to continue in 2015, which they say is already off to a positive start. In many parts of the ...

and more »


Real estate transactions
Bradenton Herald
$2,550,000 Bering Wilhelm J, Bering Margareta K to Shivrushil LLC, Lot 2 Blk B Travelers Oasis, O.R. Book 02560 Page 1778, March 17. $1,131,407 SLV II CCE Venture LP to Cardel Homes US LP, Country Club East at Lakewood Ranch, O.R. Book 02560 ...



A Guide to Scientology's Most Ostentatious Real Estate
Gizmodo
The documentary Going Clear: Scientology and the Prison of Belief, which debuts on HBO tonight, offers the first in-depth survey of Scientology's practices, including its ongoing quest to acquire high-profile real estate. Since it was founded in 1955, ...

and more »


Green Bay Press Gazette

Make an educated real estate referral
Green Bay Press Gazette
Q. A close family member wants our help referring them to a real estate agent. Their house has been for sale on-and-off for several years. They blame themselves for poor agent choices, but we are suspicious they may be the cause rather than the agents.

and more »


Fitch: Poly Real Estate's IDR Not Impacted by Higher Leverage
Reuters
(The following statement was released by the rating agency) HONG KONG, March 29 (Fitch) Fitch Ratings says that China-based Poly Real Estate Group Company Limited's (Poly) higher leverage as at end-2014 has no impact its Long-Term ...

and more »


Drama abounds in the real estate game
OCRegister
Because nothing says “DRAMA” better than the spring real estate market. Unless you want to bring up reality TV, which is somewhat less than real. If you could tap into the experiences your friends are having as they try to buy or sell a house today, or ...



Indianapolis Business Journal

Online real estate brokerage Redfin enters market; brokers unfazed
Indianapolis Business Journal
Johnson, 31 and with 12 years of real estate experience, came to Redfin from Kirk Realty Group LLC in Fishers. He's hiring agents, though he declined to divulge how many or the number of homes the company has listed or sold, citing competitive concerns.



Seacoastonline.com

Building a hospitality real estate niche
Seacoastonline.com
The niche of Wason Associates at 1 New Hampshire Ave. at Pease International Tradeport is hospitality real estate, brokering the sale and purchase of restaurants, hotels and motels and resorts. Most of the people in this business, according to Wason ...


Google News

home | site map | Blog |
Portland Oregon Real Estate Listings | real estate investing | real estate in greece | for sale by owner in atlanta | House for sale: Louisville KY
Exchange Links Here | Links page | Invalid Request - Error A109
© 2006