Owner finance vs Lease option

[Maggie Nickerson]

Hello all Bigger Pockets enthusiasts! I am new to this site so please be kind :)

Question:  As an Investor would you prefer to purchase a property from a motivated seller through owner financing or lease purchase and why?

An opportunity to purchase a property has recently presented itself to me, the seller is offering owner financing at 3.5% and I'm wanting to know if a lease purchase would make more sense.  I plan to lease the property out for a few years then sell.

Thanks in advance,

Maggie

[Brian Gibbons]

@Maggie Nickerson

Buying on Owner Financing - Installment Sale is much better than Lease Purchase, with rights to sublease.

Get a 30 year amoritization schedule.

Tell sellers you are not living in it and Dodd Frank does not apply.

It may be a great buy and hold instead of lease purchase exit.

Can you guarantee the payment to the OWNER if the tenant you lease purchase to does not pay?

Have 3 months payments in reserves.

Best wishes,

Brian