|
|
 |
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!
´
 Back To Top
About the Author
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 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: subscribeHBS@homebusinesssolutions.com
Click here to learn more about Chuck and Sue DeFiore
Articles by Chuck and Sue DeFiore
 Managing Cash Flow 
Juggling The Day With A Deal
Various Aspects Of The Lease Purchase Business
Does Your Business Need An Attitude Adjustment?
Ethics in Business..A Lost Art
Referrals…The Secret Weapon
How To Give Yourself A $20,000/Year Raise
A Forgotten Marketing Tool - The Postcard
Using Those Business Cards
Is Your Business Safe?
Getting Started In Real Estate
Take It To The Customer
The Art Of Calling on Real Estate
Finding and Qualifying The Tenant/Buyer
Checklists for Tenant/Buyers and Sellers
The Lease Purchase Business Day
Warming Up to Cold Calls
Businesses - Leisurely Dining Or Fast Food?
How Do I Implement The Lease Purchase Plan
Guidelines For Choosing A Guru, Coach...
Are You A Shoulda, Coulda, Woulda?
Are You Profiting From O.P.P.?
The Many Ways To Profit From O.P.P....
How Do You Profit From O.P.P.?
Consulting Your Way To A Six Figure Income!
Business Partners & Marital Partners (Part I)
Business Partners & Marital Partners (Part II)
The "Psyche" of The Seller and The Tenant Buyer
The Divine Secrets Of The Ya Ya Lease Purchase Hood
This article may be reprinted provided that the original author's profile information (including all links) and courtesy notice below is included with the article. You many not modify the article content or the author profile information in any way. It is also considered a professional courtesy to email the author with details of when and where their articles will be published.
Please include the following courtesy notice on your reprint:
Article reprinted courtesy of Total Real Estate Solutions
http://www.totalrealestatesolutions.com
|
