3 Ways to do Lease Options (Flip bonus)
Written by  Cam Rowland on Jan. 11th 2019
Hey, I wanted to share with you three different ways that I typically do Lease Options or Rent to Owns and I want to share them with you and get your thoughts.

1). So the first way that I typically do a lease option is with one of my own properties and for those of you who don't know what a lease option is or what a rent to own is, basically what we do is we help people get into home ownership and our tenants become our buyers of the property that they're renting, tenant buyer. And so that's basically what it is in a nutshell. So with my own property, we'll do that. And something I won't go into super deep here, but it's a great strategy is to do a flip and turn it into a lease option, multiple profit centers and there's a ton of reasons why that works really well, but I'll come back to that one at a different time.

2). The second way is to find a frustrated landlord who's kind of pulling their hair out with tenants or a, they can't look after the property well, you become their solution to their problem and you also become their exit strategy. Great Opportunity doing that, finding those landlords that need your help.

3). The third way is to partner with investor and you put together a deal and basically your investor put's some money down and qualifies for the mortgage. You manage the whole deal from start to finish.

So the last two examples are great ways to do no money down or low money down deals and you're partnering with other people, but a great way to build your portfolio. So a couple of questions for you. One, first of all, for those of you investors who've done a lease option before, which is your preference, one of these strategies or do you have a different way that you like to do it?

And secondly, if you're new to investing or just getting started out and exploring the idea of doing lease options, which of these do you think you'd gravitate towards the most? 

Turn your house flip into a Lease Option/Rent to Own!

So previously, I talked a little bit about doing a flip and turn it into a lease option. So let's unpack that further.

So let's say that you're buying a property that you want to do a flip, you want to renovate and you want to sell. You're buying it at 40 to 60 cents on the dollar of what it's going to be worth after the repairs, but rather than just stopping there, why not consider turning that property into a lease option or rent to own? And so what you do is while you're doing the renovations, you would qualify a tenant-buyer, have them ready to move in. Basically, whenever you're done the renos, have them move in.

Now you've got no vacancy costs. They're going to sign a two to three year lease with you. So now you can go back to the bank with your three year lease of your tenants that are in there, it could refinance your property based on this new value. Get your capital back out that you put in. Now, what can you do with that capital? Well, you can maybe buy another property as a down payment or it's new funds to do a reno on a different property, but now you've got your capital back out. 

You've got tenant buyers in there, they're going to pay you for three years. So we've got no vacancy costs and they're going to buy it from you after three years. And then at that time when their buying it, you have no selling costs. Again, no vacancy and you can sell it to them for top fair market value of the property that it will appraise for. Then when you're done, you've now made a profit from the flip as well as with a lease option tenant, buyer or rental and client in there. And start all over again. 

So what are your thoughts on that? Those of you who are flippers, have you ever done this? Have you considered doing this, and what are the opportunities? 

Please comment below. Love to hear your feedback.

Cam Rowland

Cam Rowland helps investors . He is an expert at helping Real Estate Investors generate outstanding cash flow, with little/no money down. If you're interested in trying this unique investment strategy or scaling up and expanding your real estate investing experience, then definitely reach out and request a free strategy session today.
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