Property Lease Options UK - Lease Options Property Investing
Lease Options Made Simple On Twitter Lease Options Made Simple via RSS Lease Options Made Simple On Facebook Lease Options Made Simple On LinkedIn Lease Options Made Simple On YouTube
learn lease options articles

Property Lease Options – Using Lease Options to Create Your Financial Freedom

Lease options are powerful tools for creating financial freedom. What makes that statement true? How does that affect you? Please read on to find out more.

Lease options and tomatoes…

Tomatoes change with time. Green ones are toxic. Red ones are not. Timing is key. Imagine being able to harness that! You Joint Venture with Time to transform something toxic into something healthy. Property Options can empower you to do just that.

Option Agreements – What are they?

Options are agreements which give the holder freedom. Depending on the wording, the Owner grants you exclusive freedom to buy, use or sell the Property, or a combination of these freedoms. Options are powerful, simple to use and flexible.

With an Option, a splash of creativity and a genuine interest in others “toxic” property can magically become healthy! Skilfully weaving such simple solutions brings wealth running.

What can make options work for you?

Tomatoes need more than time to blush. Warmth, light and water are all essential. It’s the same with Options…

For your efforts to bear fruit experience shows the Vendor must like you. There must be warmth in the deal. Create it by listening, asking the right questions, and holding a genuine desire to help the person who needs what you have.

Only if you appreciate their motivation for selling, (the “Why”) will there be trust and warmth.  If the Seller is not sold on you, walk away.

Success with Options requires the light of honesty. Is the Vendor clear on whether you intend to buy, sell or hand the house back? Lenders have requirements, and though it may be easier to ignore them, rushing Options through, that will harm your reputation and profit. What about “Consent to Let” and buildings insurance? Is your paperwork suitable for the UK market?

The paperwork is the greenhouse glass. It should be transparent. Although it must be watertight to create the desired environment remember it is brittle, so avoid throwing stones.  Anything you structure must be good for both sides. Always be consistent and true to your word.

Sandwich options

Selling a property you don’t own through a “Sandwich Option” may appeal, but what about the legal complications? Some of the more experienced Optioneers in the UK are working hard to find ways to better protect Tenant Buyers and comply with
Lender criteria before getting overly excited about this.

Keeping your viewpoint right

Ants on a canvas don’t enjoy its beauty; ensure you avoid that mistake. Step back. Get the whole picture. Options can create cash fast, but a big-picture vision grows a solid reputation bringing true satisfaction and lasting wealth.

Avoid saying too much when explaining how options work

Ideas drown in words, and saying too much rarely gets the deal to fruition. Beware of swamping the Vendor you want to help! They need just enough information to feel comfortable and informed. Watering little and often brings the best results. UK
vendors might be described as sophisticated and possibly enjoy a different approach to that used in other English speaking countries.

Property Option case studies

Buying on a purchase option

The Situation: A family needed to sell their empty large end-terrace; the mortgage was crippling them.  £93,600 would clear the debt and inject capital into their restaurant business.

The Want: £110,000 in 4 months

The Need: A quick sale of £95,000 and instant relief from mortgage payments

The Solution: A 4 month Purchase Option (£93,600) with mortgage payments (£475) coming off the balance at completion.

Commentary: This Option was assignable. The investor I sold it to made 3 mortgage payments before buying.  He converted it to two flats and achieved an end value of £200,000.

Using a Lease Option

The Situation: Two brothers own an empty modern 2 bed house with no debt; 6 months marketing at £85,000 found no buyer.  Unwilling to become landlords and struggling to pay the mortgage on their new home, they needed a quick fix.

The Want: Clear the mortgage on the new home

The Need: Monthly money to cover the mortgage on their new
home

The Solution: A 48 month Instalment Purchase Option (£67,000) with permission to let

Commentary: I pay them £280 pcm and let the house for £650 pcm. I will buy within the term and hold. There are many houses out there mortgage free, which seem to the
owner to be a liability!

Selling on a Lease Option

Tired of problem tenants, Allan responded to my line add.  His 3 bed semi was perfectly located. It was important for him I didn’t negotiate on the price.  The property was mortgage free.  We quickly forged a 48 month Instalment
Purchase Option at £82,500 and agreed my £250 monthly payment would be credited to the purchase price.

The Financials: I get rent of £500 pcm. The family improved the property hugely and can buy within 36 months for £110,000. £2,000 was the deposit; work’s credit of £10,000; £50 a month instalment.  If they buy in 36 months they will pay £96,200. I will owe Allan £73,500.  My total profit will be £36,620.

The family are ecstatic in their dream home.  Allan has peace of mind and a monthly income.  I made some new friends…and an amazing return for a couple of hours work.

Succeed with Lease Options

Success with Options eludes some. To craft solutions focus on the person, not the property.  Understand their wants but address their needs, show warmth, be fair and honest and water judiciously.  Remember, options are primarily tools for helping people, and secondly instruments for profit creation. If you do, even the greenest tomato will blush and you will have huge success with lease options.

« Back to All Articles

11 Responses to Property Lease Options – Using Lease Options to Create Your Financial Freedom

  1. Janet Knight says:

    This is an exciting article on the foundation of lease options. I like very much the emphasis on helping people and how, like a tomato, a property can go from toxic to profitable with a little time and care. My main point of interest is to expand my portfolio but my sideline is to be able to help people locally to me that either need to sell or need somewhere to live. I think using lease options and using them correctly could provide me with the solution I need.

    Thank you

  2. Tony Jones says:

    Hi Mark,

    Fantastic lease options blog, a real eye opener for budding investors like me to learn from a seasoned professional. I find your explanations and metaphors so simple to understand. My favourite is likening lease options to tomoatoes and how time can change something toxic into something healthy.

    Ultimately I want to use property lease options to create financial freedom and I think I may have found the place to start!

    Best wishes

    Tony Jones, Herefordshire.

  3. Jon Steadman says:

    Hi,

    I have dreamt of creating financial freedomm for some time. My mundane 9 til 5 job is driving me mad and the prospect of leaving and investing in property is very exciting.

    I have been learning lease options for some time and really believe in using lease options to create financial freedom. I think a visit to your shop is in order.

  4. Dave Mahon says:

    I read the selling on a lease option example and can’t see how you worked out your total profit. Could you explain please?

    Thanks!

    Dave

  5. Tara Brown says:

    All this talk of tomatoes and sandwiches is making me hungry Mark. 🙂

    You should be commended on your relentless efforts in educating. It goes without saying that your enjoyment and enthusiasm for what you do is inspiring.

    • Juliet Strange says:

      fantastic lease option resource. Please keep providing free lease option information.

      Juliet.

      • Susana says:

        The idea of being free from my mundane day job is so overwhelming I have never been able to think too much about it. I would love to be in a position financially to spend more time with my growing family whilst maintaining (or better still, improving) my current income. Exploring lease options seems to make my dream a possibility. Some more reading required but I think I know how my spare time is going to be spent for a while….reading your articles.

  6. Becki says:

    I really want to get free and leave my job. Would you say lease options are a really good way to get financial freedom? It would seem that it is working for you and your students. How do i become one of your student s or work with you?

  7. Micky says:

    This post should be printed out and given to every property investor who thinks he can’t use lease options for proeprty investment.
    Brill! Can we have more information on lease option contracts please. 🙂

  8. Trevor says:

    I am looking at lease options myself and this is very useful!

Leave a Reply

Your email address will not be published. Required fields are marked *

Connect with us on social media:

Lease Options Made Simple On Twitter Lease Options Made Simple via RSS Lease Options Made Simple On Facebook Lease Options Made Simple On LinkedIn Lease Options Made Simple On YouTube