@Johnquel Jones good to see others who are like minded. As far as "how the process works" I suppose that would just depend on how you want to approach the situation. Say you find a property that you purchase for 40K and then lease it out with the option to purchase at any time for 30 years for 60K. Now, theoretically in this case say you charge 5% interest. You could then collect a non refundable option consideration of 10k (an arbitrary amt in the example) before move in. The tenants would then have total control of the home and would be responsible for paying util, taxs, ins, ect. In the event that they quit paying, you could treat it as an eviction not a foreclosure (which can take 3+yrs in NY). Also, your non refundable option consideration is large enough to cover any damages and lost income that may occur. This would be your "downpayment" but you want to make certain that you don't give them any type of equitable interest in the property because in the event of an eviction, the tenants can use that to their benefit. You may choose to apply that amount to the remaining balance of their loan if they do end up purchasing the property and they've had a good payment history with you.
Now, I would certainly get legal advice on drawing up a lease option agreement and make sure that you protect yourself from every bad possible situation you can think of but in a nutshell, that's the concept that I've seen work well. I'm not a lawyer, that's why I pay someone who knows what they're doing to do it for me :)
Do some research on lease options and take it from there. There's obviously tons of ways to "become the bank" and different paths may work better for certain people. I'd certainly be interested in hearing what you find out.
Amber
