Home owners, do you have a home that you want to sell on a Rent to Own basis?
Here is what I do, you may wish to do the same if you have a home that is
vacant, not selling for the price you need due to the market we are in or simply
an investment. You can
do it all yourself, however if you have a home in Pierce County and wish me to
help you find a rent to own candidate, then I would receive a fee
(see below) for my
services of course. This is for Washington State real estate only. Laws
in other States vary.
Basically most people would rather own a home than rent one.., but most
simply cannot come up with the needed credit scores and/or down payment needed.
A person who has a "hope" of buying a home and is willing to pay rent with an
option to buy, can in many cases be counted on to:
1. Pay their rent on time! (or loose
their option to buy)
2. Handle more of the maintenance, clean up and repairs than the average
renter.
3. Will often be willing to pay a fair retail sale price for your home, more often than
most buyers, who would rather negotiate a better deal.
We require of renters;
1. A qualified job, meaning that
they have been on a job at least a year and its full time or that their co-buyer
or spouse qualifies.
2. No evictions on their records.
3. Enough cash to pay 1st + Last months rent + deposit. Depending
on the plan chosen, deposits vary.
4. Willing to pay a $30 for a basic screening fee, which checks for
criminal background and any past evictions, or $45 for a full screening and
credit check.
In order for me to bring you a qualified
Rent-to-Own candidate, we would
also need to be the Property Management Company, see
www.bci-properties.com/owners.htm -
EXAMPLE of a Lease to Own plan:
Let's say your home has been on the market for 6 months
with no offers at $295,000 but you originally had it listed and wanted to sell
for $329,000.
You are frustrated at trying to sell your home, so you decide to change your
terms a little and offer your home for sale on a Lease-to-Own Purchase.
This opens your doors to the largest market of eager buyers anywhere. You call
on BCI Properties, LLC as the experts in this field to handle all of the
detailed complicated paperwork and legal forms, tenant screening,
maintenance concerns and Escrow setup when and if the tenant does buy the home
in the end, we deal with it for you. Ok, so now we advertise:
****************** Sample Ad
*****************************************
Oakbrook Home For Lease-to-Own
12345 Holley St., HomeTown, WA USA
4 bedrooms, 2.5 baths, jacuzzi/tub, BBQ deck, large fenced yard.
$329,000 purchase price - Locked in for tenant!
- Lease to Own - Terms
- Poor credit ok - screening required $35 paid by
applicant
- 5% non-refundable Option deposit down = $16,450 down
- $2, 460 a month rent
- $2, 460 security/cleaning deposit (refundable)
Total down needed to move in: $21,370
***************************************************************************
Along comes Ben the Buyer who is self employed. He was
turned down by XYZ mortgage company because he needed to be self-employed for at
least 6 more months.
Ben the Buyer pays all of his bills on time, earns a great income, and is very
responsible -- but he can't get a mortgage to save his life. Ben the Buyer is
dumfounded at his predicament and is tired of throwing money away on rent.
Ben sees your ad in the paper and calls you to make an appointment to come see
your house. He loves it and wants to buy it! Yay!
Ben is "...willing to pay you full price..."
Since you're flexible on terms and are offering a tremendous value, Ben is
willing to pay you full price for your home. He is able to put $21,370 down, pay
you more money per month than your mortgage costs you, and he agrees to buy the
home from you within 12 months. You draw up the paperwork, get the cash and
close the deal.
Now you've got a non-refundable option deposit of $16,450, a positive monthly
cash flow, a written sales agreement for FULL asking price on your home within
12 months... PLUS you maintain your tax shelter by remaining on the deed, and
there will be no maintenance or landlord headaches since Ben will take care of
the home as if it were his own!
You might be wondering, what if Ben decides not to buy your home? GREAT! I love
it when that happens! You get to keep Ben's $16,450 (minus small fees) option
deposit PLUS you get to put your home back on the market so you can collect
another large option deposit -- and probably even increase your sales price!
What can go wrong? Several things can go wrong of
course, but you
have a couple means of protection once you understand how to obtain or use them.
First of all, if you hire BCI Properties, LLC to do your Property Management and
end sale, then we handle all the red tape, hassles and complicated forms plus
tenant headaches, possible eviction etc. - You can also read and become familiar with the Washington State Landlord-Tenant
Act, Laws and Regulations. It will protect you as well as your tenant. Also,
ALWAYS have proper insurance and your insurance carrier will fill you in on
that.
Our fees and what we require of owners:
- There is a pre-set
fee schedule for the Lease or rental contracts. Generally 8% of
rents collected, plus a one time setup fee of $75... etc.
- With the Lease/rent Option to Purchase, we are
negotiating on your behalf as your Agent/Broker. We retain a percentage* of any
non-refundable deposits which are collected as a fee, plus when we sell
your home we provide all the same forms/paperwork, Escrow setup and
transaction coordinator duties as usual for only 3% total, due at
closing and paid to us by your Escrow company from sellers net proceeds.
- There is a contract which must be mutually agreed
upon, which will allow us to collect rents, manage maintenance needs and
handle most all day to day business regarding your property. The Rent or
Lease-to-Purchase Option must also be agreed upon by the property owner.
- A filing will be made to Pierce County Auditors
office to show a Lease-Hold or Option interest in your property which
will expire when lease expires unless the Lessee or renter exercises
their option to purchase. Please know that Leasee or renters have rights
by Law, as does property owners. Read "The
Law of Real Estate Agency" and "Washington
State Landlord Tenant Law" for more information.
