In any lease, when negotiating lease and option agreements, you must obtain the following six key conditions:
1. Two-year lease.
2. Two-year real estate option agreement.
3. Fixed purchase price that is at least 20 percent below the current market value of the property.
4. Rental price that is at least 10 percent below the market rental price of the property.
5. One-year extension clause in the lease.
6. One-year extension clause in real estate option contract.
Require that all lease payments be made to a licensed credit service company:
As a lessee optionee, the only way to become a victim of an equity recovery scam is to require that all lease payments be made directly to a licensed credit service company. For example, the loan services company would use the money it receives from you as lease payments to make loan payments directly to the lender. This way you have verifiable proof that the loan payment was made and you are not funding the homeowner’s fraud with equity skimming.
The best type of house to use the rental and option strategy:
The best type of home to employ the rent and option strategy is a three bedroom, two bathroom home with an attached garage and a fenced in back yard in a stable, middle-income neighborhood that is conveniently located near:
1. Medical facilities.
2. Shopping malls.
3. Schools, parks and playgrounds.
4. Military Bases.
5. Office and industrial parks.
The property owners most likely to agree to a lease and option deal:
The types of homeowners who are most likely to agree to rent their home with an option to buy tend to be:
1. Owners of vacant houses.
2. Owners who are temporarily relocated out of town by their employer.
3. Military personnel on short-term transfers.
4. Absent owners living out of town.
Rental and option properties are relatively easy to market to potential buyers:
The best thing about using the lease and option strategy is that it is relatively easy to market a single family home that is under lease and option if you are the renter residing in the property. In fact, you don’t even have to put a for sale sign on the property. All you have to do is place a well-written ad in your local newspaper that directs prospects to a phone number or website address. This way you avoid being bothered by nosy neighbors and people who are just looking but are not serious buyers.