We have a fairly thorough application process. Once we get the application for a property in, the office will start with a cursory eviction check and criminal check.
If they pass that and it’s a lease to own property, then we’ll run a credit report on them and run through their credit. We go through it and try to do a pre-qualification to see if it looks like they’re worthy.
If they pass that test, then we send it to mortgage companies that we work with, usually it’s two or three of them. We have them do the same thing.
They have a cover sheet that they fax back to us. The sheet asks if they think they can get the prospect tenant buyer cashed out now, in three to six months, six to twelve months, or not at all. The mortgage companies will answer.
If all three of them reply by saying, "Yeah, we can get them financed now" then we got us a winner.
If one of them says they think they can get it done in three to six months if the applicant can do this and this. Then someone else says six to twelve, now they’re in the ballgame and we can put them in the pipeline to see what we can do with them. We’re trying to find out whether we can get them cashed out right away or if they qualify for the lease to own.
If they can come back in with 5,000 or 10,000 dollars but they’ve got some heavy dings in their credit that they’re willing to work on. We’ll get them cashed out if the mortgage company is willing to work with us to help counsel them.
Every now and then the applicant will show up with their own financing. That’s a good thing. That means their head is in the game. We like that.
When it comes to tenant cash out deal, they’ll call and they won’t have credit and/or they won’t have a down payment. After talking to them they’ve got mom or dad or an aunt who can help them. They have excellent credit and with the help of their relative they were able to buy it or land contract it.
They’ve got great credit, they can get great terms and they can give you a better payment than what you can get with us. We’ve been able to sell this type of person a house and been able to help walk them through that deal.
I try to get people to think outside of the box with buying homes. I try to get them to buy with the IRAs and I try to teach you to bring in private lender to fund your deals.
Six out of 10 folks in my office have at one time had used private money to fund their first house purchase.
They got mom and dad to help them out with the house purchase. In some case the mom or dad would buy the house and sell it to the kid on a land contract. However they went about doing it, it got the child into the property.
That is what we’re trying to do with your clients. You want the people who are or will be sitting in your house to buy it. Teach them to use private lenders; they need to know how easy it is. That’s why I came up with those two home study courses on private lending. They’re just miniature courses to help with a certain situation out there.
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