Many people have used a rent to own/lease purchase/lease option method to buy products without realizing they actually have. Everyone knows about the rent to own stores where you can buy just about anything and may monthly payments until you own it outright. People do like this method of buying things, the problem is that it ends up costing them a lot more over time than if they paid for it the traditional way due to the interest that has to be paid.
Investors have used rent to own methods for years to make money in real estate. Creativity is key when trying to work out lease purchase or rent to own deals. If the seller is motivated enough, they will listen to any offer you bring. You are trying to find a motivated seller and a buyer that wants a house but doesn’t have either the credit or down payment to get a home in the traditional way.
The investors comes along and agrees to take over the motivated seller’s property at a minimal down payment, then paying them monthly until they either pay the home off or get a lump sum from the new tenant or buyer. The term of the loan is negotiated. The investor makes it clear that he can buy the home at any time during the length of the loan.
The down payment negotiated just depends on how motivated the seller is. If it is no money down then you offer the seller $1 to make it a binding agreement. Again, being creative can make you lots of money when investing in real estate like this. There are many ways in which you can give the seller what he wants and at the same time making a handsome profit for yourself.
