Most investors are aware of what the Rent to Own investing strategy is and how it works. But for those that don’t lets me give quick overview!
Standard Rent To Own Investment Strategy
This works very much like a typical home you purchase to rent out. The main difference is you are going to give the tenants and options to buy that home at the end of their lease. You might have difference points at which the tenant can purchase and a predetermined price for each of those points. Regardless the goal is to determine your profits on the home upfront when you lock in the tenants to the buyout price.
The other advantages of this system over straight rentals is you generally will get a down payment upfront and a higher monthly rent.
The downside with a typical Rent to Own investment is the same as with a rental in that you have to buy a home then go through the process of marketing the home to find a tenant/buyer. This can take time and while the home is vacant you will have holding costs that are not being covered by incoming rents!
Rent To Own risk free!
With this system we are going to turn the typical model on its head, literally!
Take for example what happens when a home buyer wants to purchase a home to live in. What do they do? Generally, they find a Realtor and that agent shows them properties they would be interested in purchasing. When they find one they like they make and offer and if all goes well they own the home in around 30 days (depending on external factors).
So let me ask you a question! What is the difference between a person buying a home today or one that is trying to find a home to live in and lease then buy that home a few years down the road when they qualify for the loan? You probably answered those few years, right? Wrong, there is no difference. Both are examples of people who are trying to find their home. Not a home they want to rent. They are looking for a home they want to call their own!
Do you see the difference and power in this? No?
Let me explain and here is the twist to making this investment type risk fee! Stop looking for an investment property to buy then find the tenant/buyer. Flip it on its head. Find the tenant/buyer and purchase/invest in the home they want! Doesn’t that make sense?
Why look for a purchase a home that you have to fit a buyer into when you can eliminate the risk simply by letting them pick the home to buy. It’s really easy to do.
Change your advertising to find the tenant/buyer. Something like "local investor wants to buy a home for you!" Once you find the right tenant/buyer, go shopping for the home. You eliminate your risk and the vacancy period because your tenants are going to move in the day you close on the home. Additionally, they are going to give you your down payment at the same time.
In fact it your really good, you will be able to buy a home with no money down as an investor even today. How? You will use 24 hour financing as your down payment then get reimbursed by your tenant buyer that same day!
Obviously, you can establish your business credit and skip the 24 financing. You can get our training on business credit at this link.
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