I recently figured out that a LO deal, duration and rent credits has to be accepted by the eventual bank who cashes the deal out in 1-3 years.

@Brian Gibbons you're right, only because most of the slim/no equity sub2 and L/O's I see fall apart, usually because they are being sold to an unqualified end buyer.

Point them to page 189 at this link if the LO is unfamiliar, which is often the case.

LO's are a great way to start!

Mehran Kamari I was supposed to close on a deal yesterday using conventional financing but the LO told me at the last minute that my loan had not been approved.

Thanks Mathew, yes, LO is a very nice area, I have absolutely no complaints growing up there!

With $30k in equity, a CA lease option might be the way to go, and @Brian Gibbons can certainly give you input on that.With a LO though, she'll still retain title, so you just have to see what are the best options for the seller.

L/O options to someone with poor credit????

@Brian Gibbons is right on with what he said..Here are the challenges you need to be aware of with doing a LO with a current tenant..THey have NO money to put towards the option feeThey already LIVE in the house, so they don't have much to loseThey have NO direction or education about getting ready for financingIf you don't get additional money down, you basically have a glorified lease in place.As Brian said, get them with a mortgage broker and see where they stand so you can determine what is the best option.They may be agreat, or they may be so bad that they'll never finance.

I see talk about LO to eventually sell to end buyer, but I haven't been able to find anything about using LO to control the property and just lease it to someone else.I am looking at a property that is a short sale close to a college that would be great for a student rental.