Option with Payments - Continued

Why not offer to assign the payments to the real estate owner for an option over a period of time until you can obtain financing. If you cannot make the deal work, then there would be a time where the option would expire and the payments would revert back to you.

Of course, you could also just make your option in the form of monthly payments directly to the seller, and have the amount you are paying equal the monthly payments you are receiving from the note. In other words, the payments you are making on the option, will be the same as the payments you are receiving on the note. This is a form of compensating notes. Be sure to get the option notarized and recorded, or at least a memorandum of an option.

Another slant on this technique is to offer the entire note as an option for a longer period of time. You would have a problem if the note went bad during your option period. What would you do? You would have to guarantee the note payments should the payor quit paying for some reason. Notice I said guarantee the payments, and not guarantee the note. You would then only have to come up with the payments to keep the option alive should the note go bad. This is a far cry better than having to come up with the entire amount of the note.

For those who are doing the lease option technique, if push comes to shove, you could use this as a technique, but generally, those sellers who would accept a lease option technique are motivated to the point where little option money is needed. However, this still would be a lucrative technique. Instead of giving the seller a couple of grand for the option, merely assign the payments to your existing note, or create a personal note that would match the payments received from your note. This is a cheap way of getting your option.

As always, consult an attorney and CPA. I cannot emphasize this enough.

Try this technique, contact the Professor, and tell him how it worked.

ANNOUNCEMENT: My last April seminar was a sell out, and a few were even turned away because there were no more seats. Some have requested of Cathy Crowe that I repeat my seminar. I will be giving a repeat seminar on THE ABCs of NOTES and REAL ESTATE on Saturday, June 25th, from 8:30 a.m. to 5:00 p.m.

Because this is a "hands on seminar" where we cover everything from from how to use a financial calculator with ease, to structuring note deals to create wealth. We will also cover getting notes for free to put in your IRA. THE CLASS WILL BE LIMITED TO 20. You will need to bring a HP 10BII financial calculator to class, unless you are familiar with another financial calculator. I will be teaching with the HP 10BII. I will be teaching from THE NOTE PROFESSOR NOTEBOOK, which you can purchase at the discounted price and have it sent to you prior to the seminar, if you contact me directly.

For details on the seminar, contact Mayra@dfwrein.com. Of course, you can always contact me.

I look forward to seeing you there.

Tom Henderson a.k.a THE NOTE PROFESSOR

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