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Updated over 12 years ago,

User Stats

163
Posts
8
Votes
Lokesh W.
  • Milwaukee, WI
8
Votes |
163
Posts

Loan Modification before Lease Option? Need Help with RE Strategy

Lokesh W.
  • Milwaukee, WI
Posted

I have a home owner who wants my help in selling her home by doing a lease option. The home is in good condition but has negative equity. They have not missed any payments. I am trying to do a cooperative lease option (i.e. I will assign my lease option to purchase to another retail buyer on rent to own basis for a fee):

Market value: 150K
Seller owes: 160K
Seller payments to the bank (mortgage + tax + insurance): 1500/month

The owner does not want to bring in any money to the closing table. Initially, I suggested 1500 a month rent with $200 rent credit but this will not work out.

Based on what the owner said - if we rent at 1500 a month and owner uses this as the monthly payment, then they will owe 150,000 in year 2019 so this may not work out.

I am thinking of doing a loan modification to bring down the payment or interest rate and then a lease option. Is this possible?

Any suggestions to make this a Win/ win/ win situation using lease option for the seller, tenant buyer and I??

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