Emmalou from Utah

[Emmalou Penrod]

I am a school teacher and my husband is retired.  We have been dabbling in real estate investing for a few years.  We own some developed lots, two rental houses, a tax lien and a four-plex.  We would like to increase our efforts and become more efficient.  We are starting up a lease to own business to support families who are not able to qualify for a traditional loan.  We are struggling with finding buyers.  Does anyone have suggestions on locating prospective home buyers who would qualify for a lease to own contract?

[Jeff Rappaport]

@Emmalou Penrod, in my experience it should not be difficult to find rent to own buyers.  Obviously, there are some variables that make a difference.  The price point of the homes you are renting, the area, condition and the terms all make a difference.  You typically can get a premium for the property and the high end on rents.  You should also be able to secure an option deposit of somewhere between 3-5% of the purchase price.  I typically give the tenant buyer a two year option and sometimes the option to extend their option for a $1,000.  If you are dealing in the median price range and up in good areas with homes that are in good shape you should not have a problem finding tenant buyers.  

I typically only do two things:

1.  Advertise on KSL, Zillow and Craigslist.  Make sure your advertisement is going to get the phone to ring.  Phrases like "no bank qualifying" or "rent to own" usually work well.  

2.  Bandit signs all around the property.  This is the one that really works.  Put up 15-20 handwritten directional signs all around the property.  I know it sounds like a lot but it works!  Check the signs every few days and replace the ones that come up missing.  You should not have to do it for very long.  

3.  If you happen to come up with a house in the same vicinity as one you just did a rent to own on call or text everyone back that was prequalified for the previous property.  You should know what they were looking for and you already know that area was of interest to them.  Great way to fill a property quickly once you have buyers looking for rent to own.  

Hope that helps!  Let me know if I can provide any more assistance.