Wendy Patton

How To Do A Rent-To-Own As An Investor Seller
by Wendy Patton

Rent To Own SellersIn a soft market, real estate investors need to consider all of their options. How to do a rent to own should be at the top of the list. Rent-To-Own Selling is a way for there to be a win-win-win real estate sale even in today's market. Selling your investment property using a "Rent-To-Own Strategy" is a way to set yourself apart from other sellers, to get your home SOLD & realize your investing profits and also to broaden your list of potential buyers. How to do a rent to own is not without risk to sellers but the risks are manageable.


How to Do a Rent to Own - The Option Fee

A one to five percent "option fee" is completely justified because the seller cannot market the house during the option period. The option fee is typically applied towards the down payment when the buyer exercises the option to purchase. There are a few other issues the seller needs to deal with when determining how to do a rent to own.

How to Do a Rent to Own - Setting the Selling Price

There are two basic ways of setting the selling price that you want to consider when learning how to do a rent to own. First is agreeing with the buyer how to set the price at a future date when the purchase agreement is exercised. This is not my favorite way of how to do a rent to own. Using this method typically means having the house appraised for market value in the future. The risk is that the buyer won't like the price and will walk away from the purchase.

The second way is setting the price up front when learning how to do a rent to own. The risk here goes to both the seller and the buyer. The risk to the seller is the house appreciates more in value than the agreed to selling price. The buyer's risk is that it depreciates in value. How to do a rent to own should have a price 5 percent to 10 percent above the current fair market value.

This compensates the seller for not being able to market the house and anticipates appreciation of the value. When figuring out how to do a rent to own, the buyer can always walk away from the deal if the house doesn't appreciate. Another step in how to do a rent to own can be the seller agreeing to lower the price if it doesn't appreciate as anticipated.

How to Do a Rent to Own - Motivating Buyers

In addition to collecting the nonrefundable option fee, the seller needs to charge an above market rent during the option period. This, along with the option fee, applies towards the down payment. How to do a rent to own puts the buyer's skin in the game.

One final step sellers can take in how to do a rent to own is filing on time monthly payments with the three credit bureaus. The typical reason buyers go with how to do a rent to own is because of a credit report problem. Reporting their monthly payment helps improve the buyer's credit score.


Wendy Patton
Wendy Patton is widely recognized as one of the most inspiring speakers on "Little or No Money Down" real estate investing. Her real estate savvy and great depth of experience and knowledge has helped her in orchestrating the most complete and easy to follow, Lease Option Program in circulation.

Wendy is a licensed real estate broker and licensed builder with her own real estate company in southeast Michigan called Majestic Realty, LLC. She is the past President and Board Member of D.O.L.L.A.R.S. Wendy has experience in land development, property management, rehabs, foreclosures, but lease options are her favorite. Now, with over 18 years of experience and hundreds of transactions on lease options, Wendy Patton is extremely excited about the idea of teaching others and being given the opportunity to help others achieve the same level of success.


Wendy Patton Products (6)
CoursesBuying On Lease Options
CoursesGet the Deed
CoursesMaking Money With Partners
CoursesReal Estate Wealth Building Arsenal
CoursesSelling on Lease Options
CoursesWorking with Realtors


Copyright Notice
Copyright 2002-2019 All Rights Reserved. Published with Permission of Author. No part of this publication may be copied or reprinted
without the express written permission of the Author and/or REIClub.com.

Back to Top

Free Newsletter
Name:
Email:

Article Options
Printer Friendly Page
Send This to Friend

Author's Articles
7 Steps For A Successful 1031 Tax Deferred Exchange
Real Estate Investor - How To Be A Landlord
8 Tips About How to Be a Landlord
Basic Components Of Real Estate Investing Contracts
Beware Of Potential Scams
Buying Real Estate with Lease Options
Control Property Without Ownership Using Lease Options
DIY House For Sale - Good Idea?
Documenting Seasoned Funds and Paper Trails
Financing - What Are Seasoned Funds?
How To Do A Rent-To-Own As An Investor Seller
How to Find a Buyer Now For Your Deals
How To Find A Seller Now
Lease Option vs. Subject Tos
Lease Options in a Soft Market
Lease Options vs. Subject To's--Different Techniques
Lease Options: Little or No Money Down Technique Part 1
Lease Options: Little or No Money Down Technique Part 2
Lease Purchase Investing
Options On Real Estate Investment Property
Overcome 10 Objections Sellers have to Sub2 Deals
Partnerships for Real Estate Investing
Rent to Buy Best Strategy For Current Real Estate Market
Should You Be Buying Commercial Real Estate?
Subject To Deals aka Get the Deed
The Basics of Buying and Selling with Lease Options
Using Agents to Find Lease Option Deals
Why Soft Markets are Great Markets to Invest P1
Why Soft Markets are Great Markets To Invest P2
Working with Realtors For Lease Options


Author's Products

Buying On Lease Options

Get the Deed

Making Money With Partners

Real Estate Wealth Building Arsenal

Selling on Lease Options

Working with Realtors