List Categories | List All Articles | List Articles By Title
The Lease And Purchase Option
If you have an investment property, should you rent it or sell it? The answer to that question is that you should do both. If you have lots of time on your hands and are handy with tools, you can choose to rent out your property. However, if you have several properties for rent, maintaining them can consume lots of your time. You can choose to hire someone else to maintain your properties, but it cost you money. And higher expenses mean lower profits. In addition to investing your time, finding good tenants for your properties is not easy. Tenants that choose to rent usually do it for a reason. They are usually having credit problems. In addition, most tenants do not take good care of your properties like they would their own homes. And when things go sour, they can mess up your house before they move out. Your goal is to find good tenants to rent your property, transfer the maintenance responsibility to them, and create incentives for them to eventually buy your property. Including the option to purchase to the least contract can eliminate most of the headaches associated with maintenance and dealing with bad tenants. There are several other benefits to the lease and purchase option.
Because the rent is usually higher when you include an option to purchase, this can eliminate most tenants only wanting to rent. People looking for the lease and purchase option are those usually in the process of rebuilding their credit, or are saving money for their down payment. To be fair, the duration of the contract should be between 2 to 3 years, long enough for your tenants to rebuild their credit.
This contract also transfers the maintenance responsibility to your tenants. Not having to worry about maintaining the property frees up your time for you to continue to expand your business. Giving your tenants the option to purchase your property create an incentive for them to take better care of your property. You may also choose to apply some of their rents toward the down payment if they decide to buy your property. This is another incentive for them to pay the rent on time, and eventually buy your property at the locked in price.
During the contract, you cannot sell the house to anyone else other than your tenants. However, you charge your tenants a fee (usually 1 to 2 percent of the purchase price) for the option to lock in the price of your property. If your tenants do not purchase the property before the purchase option contract expires, you get to keep the option fee. However, if your tenants utilize the option to purchase anytime during the contract, you must return to option fee to your tenants. Either way, you are making money whether your tenants buy the home or not. If your tenants decide not to purchase your property and the contract expires, you can begin the entire process all over again.
The important points about the lease and purchase option are that you are looking for good tenants to rent your property, create a constant cash flow from the rent, transferring the maintenance responsibility to your tenants, which frees up lots of your time, and eventually sale the property. Your ultimate goal is to sell the property to good tenants at a price that is fair. The deal should be fair enough that both parties come out feeling like winners. This is important if you want to be in this business for a long time.
The Leverage of the Lease
In today's rapidly changing business environment it makes sense to consider all the options before paying for your business equipment - whether it's a photocopier, computer system, computer hardware or software, telephone system, security equipment, office furniture or anything else. Many business people will give great consideration to the actual purchase, getting quotes from different suppliers and considering different choices.
Using Equipment Leasing as a Competitive Weapon
Most great generals know how to design winning battle plans. They also know how to use their resources to gain advantages over the enemy.
Leases And Tenants - The Spooky Tenant
You, Mr. Landlord are pleased to find qualified tenants for your rental house.
With a Lease, The Devil Is In The Details
In the last article we looked at a few of the things you should consider before leasing that first office or storefront for your business. To recap, you should not only consider the old standard "location, location, location," but also consider things like sufficient parking, the number of employees who will be working onsite, and future growth projections.
Warning - This Lease Might Explode Any Minute
Mike Caringi, owner of a small New Jersey business that sells pumps, found himself facing a gut-wrenching dilemma last summer. Should he continue paying $ 1,500 each month for essential telecommunications services he no longer receives and for leased equipment he claims was never installed? Or, should he stop making payments and face a potential lawsuit from the firm that financed the equipment under a 'hell or high water' lease? Mr.
Increase Your Business Growth and Cash Flow Through Equipment Leasing
"If it can be manufactured, it can be leased." For the past decade or so, this statement has become more and more true to fact.
Landlord Tips And Tricks
Every real estate investor dealing in rental homes has done his own clean-up and fix-up, at least in the early years. Landlords also become very skilled at managing tenants after being burned a few times.
Insiders Guide to Snaring the Best Lease Deal
Every year, thousands of business owners and financial managers are faced with the task of obtaining attractive financing for equipment their firms want to acquire. Snaring the best leasing arrangement requires only a bit of planning and a smidgeon of finesse.
Ten Ways to Save a Bundle on Your Next Lease
According to the Equipment Leasing Association ("ELA"), U.S.
Lease or Buy? That is Always the Question with Car Financing
Leasing is a perfectly viable and legitimate way to finance a new car. Although leasing offers attractive benefits, it is somewhat more complex than buying with a loan.
Explore An Effective Revolutionary Approach To Traditional Business Financing
For business owners who need working capital now there is a revolutionary, tax-deductible cash flow solution that frees up capital and gives them the money they need to grow. This diversified cash flow solutions is known as "asset leasing.
Terms to Know Before Leasing A Vehicle - Leasing Jargon Simplified
So, you've decided that you want to lease that next vehicle. Can't really blame you.
What Happens When the Anchor Tenant Moves and You Are On a Ten-year Lease?
Recently there was an article in the Houston Business Journal of the anchor store in many shopping centers through out Houston pulling out. Kmart, took out some stores, so did three other big box stores and a few consumer electronics places and larger furniture stores, now Albertson's has left.
True Tenant Tales, Volume One
Working with tenants can be an amazing experience. (Owners and contractors are equally astounding, but those are subjects for another day.
Lease Contracts - The Meaning of Joint and Several
When you see the phrase "joint and several" in a legal document or contract it means that that the parties on one side of the agreement are responsible individually and collectively for the terms of the agreement.Example: In the case of two tenants signing a lease agreement, "joint" means they are jointly responsible for the rent.
Pricing Your Apartments
How do you fix a price point for an apartment? Take a guess? Figure it based on your carrying costs? Check comps and do a market analysis? Charge whatever the market will bear? If you're looking to place quality tenants, less is sometimes more.We all want to make money with income property; the more the better! When you're looking for a new tenant, however, don't assume that you're going to make more money by charging more.
How To Choose An Equipment Leasing Company
Leasing has become a preferred form of equipment financing, accounting for more than 30% of business equipment acquisitions. Each year, thousands of U.
Venture Leasing: Startup Financing On the Rise
According to Pricewaterhouse Coopers, investment by institutional venture capitalists in startups grew from less than $3.0 billion at the beginning of the 1990's to over $106 billion in 2000.
How Venture Leasing Added Millions To A Startups Equity Value
Craig Berman beamed noticeably after completing his board presentation. Berman, CEO of a startup that develops nanotechnology applications for the defense industry, had just closed a $ 20 million equity round.
Interim Rent: Equipment Leasing's Trap Door
Many lessees enter into lease transactions that they believe are competitive based on faulty rate assumptions. Most lease rate calculations don't take interim rent into consideration.
home | site map
All articles are copyright to their owners.
Note: this website lists articles, We do not Write Articles !