Late Payments Could Spell Trouble for your Lease Option
Make sure you do everything possible to ensure that your Optionee pays the monthly payment early, on time or, at the absolute worse, 15 days late. One of the main components of Lease Option financing is that the Tenant has proven that they can pay their house payment on time. If they can’t, then the lender is going to be very cautious about giving them a loan.
Therefore it is to your advantage to offer your Optionee incentives to be early. Perhaps instead of the usual $100 per month credit toward the payoff of the Option Price, give them an extra $50 if they pay before the 1st of the month. What does that cost you when it’s all said and done – $600 a year? That’s nothing compared to the payday you will receive when they exercise the option if you done your numbers correctly, and it ensures that you won’t lose out because they were thirty days late once in the past twelve months!
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