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One of the best ideas that I have
used when trying to get a lease purchase deal closed uses an alternative type
of option consideration/ earnest money deposit. If the seller is okay with
the idea of a lease option or lease purchase but thinks my consideration a
little too low, I simply ask him how much exactly he needs. Once I get that
figure my reply is something like this:
"So if I could
give you $X as consideration, then you would be able to go ahead today?"
When he says yes, I offer to use all or a portion of the
original consideration/deposit to purchase a zero coupon bond (not subject to
state or local tax usually) that will be worth X in X period of time. Really,
any type of financial investment will work here.
It is easy to show the seller the value of say $3,000 in x years when you
have a Barrons financial news with you. I have paid for the brokering
fees associated with this. Using this method, I have been able to turn $1,000
into $2,500 for the sellers option consideration/deposit. This works nicely
with higher priced properties, since the sellers can understand the concept.
In addition, all of my lease options to a tenant buyer include a clause
requiring electronic funds transfer of the monthly rent and option
consideration. There are two types of services I use.
One allow a third party service to draft the tenants account, I am sent a
postdated check every month so I can cash them myself. I pay $1.50 per
transaction. The other uses true funds transfer from one account to another.
This can be done on your own PC.
I also avoid future problems for tenant/buyers qualifying by NOT giving
monthly rent credit. In instead, they pay monthly OPTION consideration. This
prevents the bank from questioning the rent as being fair market or above.
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