lease optioning in Austin market

[Randi]

Hello---

In my studies as a newbie, I have been reading about lease optioning (as a selling strategy)-- in Mr. Locke's  very useful S2 course, for example. (Thanks John!!!)

What I'm wondering is what kind of option money one should try to get in this soft market.

Here's an example:

I would like to help a friend try to lease option his house since he's more or less underwater.  His payment is $1070 at 6% on 125K. House is worth 125-130 I'm guessing.

I'm thinking the rental market might bear 1150 rent. Do you get a little more when you lease option? And again, what kind of option money are folks willing to pay in a zero-down climate?

Thanks very much in advance. Can't tell you how wonderful this site has been for me!

Randi

[tedjr]

A lot of sellers are adding on a hundred or two per month and letting that go toward building up equity in the property for the t/buyer. As for downpayment if you ask too much it will take longer to get if at all. I would get at least a couple payments say $2500 but try for $5000 to $6000. Like you said the market is tight with lots of foreclosures and 0 down deals. Hope i helped a little. I would like to hear other input as well for you

Thank you,

Ted P. Stokely Jr
11505 Sw Oaks
Austin, Texas  78737

512-301-9171 home
512-587-6177 mobile

[Randi]

Thanks very much for your reply, Ted.  :thumbsup

Randi