I would like for some advice.
I have been thinking long and hard and studying the market and what is going on with wholesaling. It seems today that everyone is looking for 50% below market value. What is Market value anyway everything is going down, down, down.
What if we were able to service people who do not qualify for traditional financing or do not have cash to purchase these deep discounted properties? I have decided to build a buyers list of people who are looking to lease with the option to buy properties, or rent to own their own home, instead of just renting. Then I am going out every day and making offers on properties that fit my buyer’s criteria.
Just for example I have a buyer that is willing to put $7,000 down, Pay $1,700 a month and are looking for something in the $250,000 range. So my strategy is to go in and make an offer to lease purchase the house from the seller. I will only put down $5,000 which will come from my buyer, I will pay $1,500 a month and lock it up for the option to buy at $240,000. How will I get paid on this deal? I will get the spread between the $7,000 down from my buyer and I will only pay the seller $5,000 then I will also get the spread from the $1,700 from my buyer and the $1,500 that I have to pay to the seller each month, and at the end in 12 months when the buyer executes the option to buy for $250,000 the seller will get paid their $240,000 and I will be paid $10,000.
Add this entire amount up and it comes out to $14,400 net. All of this was with no money down.
Please tell me what you all think of this
Has anyone been successful with Sandwich leases?