In Rent to Own Real Estate, the key is to find a motivated seller. Once we have found the motivated seller and have pre-screened them over the phone, we set an appointment to see the house.
On the day of the appointment, you want to call and confirm the appointment so you don’t waste your time driving to the property and finding out that the seller isn’t there. The only thing you should take into the house is your business card. Leave everything else in the car.
Ask the seller to show you around the house. If they tell you to just look around, ask them to give you the nickel tour. The intent is to view the house with them and build rapport with them.
* People only do Business with people they Like and Trust. You must make this connection before negotiating on their most expensive investment.
Look at their pictures and nick-knacks for ideas to ask them questions to get them to talk to you. Remember, people only do business with people they like and trust. You can only do this by building rapport. Let them answer your questions and then respond to what they told you.
Use F.O.R.M. to build rapport:
F: Q. Where are you guys from? Your Response: “Oh really, I’ve got friends, family from there…” or “I have visited” or “Where is that?”
O: Q. What do you guys do? (Occupation) your Response: “Wow…..I have always wondered about that.”
R: Q. What do you guys do for Fun or Hobbies? (Recreation)? Your Response: “I do that too”, or “I’ve always wanted to do that.”
M: Q. Where can we sit down and talk?
Once seated, give them your Message, by asking them Four Questions.
* Let them answer your questions completely, do not interrupt them. Again, people only do business with people they Like and Trust! Do you like people who interrupt you?
#1. So that I can better help you, tell me again, why are you selling?
#2. How else have you tried to sell your house?
(What you are doing is reminding them they have a problem).
#3. What do you hope I can do here for you today?
PAUSE: You are thinking on how to help them, let them see your concern and wanting to help them. *Your response is that you might not be able to buy their house today because of a lack of equity.
#4. However, I might be able to help you out of your financial problem by making your monthly payment for a while and cash you out in the future, is that something we should talk about or probably not?
If they want to talk more then explain to them you can do a Long term Lease, where your company will Rent the property for a period of time and in the future you have an Option to purchase the property at a price they agree upon today. The option will be $10 Dollars which will make it a binding contact. You will have the Exclusive Option to Purchase the property in accordance to the terms you agree to. (That is how Rent To Own Real Estate is done) You will cover most of the day-to-day maintenance up to $250 and they will be responsible for any maintenance over $250.
You then tell them you will require a long-term lease of at least 60 months to make it work. You will sublet the property to a Tenant Buyer and they will be the ones to actually purchase the property in the future. However, you will be responsible for making the payment to them and taking care of the day-to-day management. If they agree, you sign a Lease Purchase Contract that you will Lease the property for up to 60 months and you have the Exclusive Option to Purchase. Then set up a Lease Option closing with your Attorney.
Charles W. Moore is a U.S. Army Combat Veteran that began investing in Real Estate in 2001. He has served as the Vice President of the Capitol City Real Estate Investors Club of Columbia, SC and formed his first Real Estate Investment Co. in 2003. He owns several Real Estate Investment Co websites and is now a successful, Full Time Real Estate Investor, Webmaster, Speaker, and Author. For more detailed information on Rent To Own Real Estate go, click here