Finding buyers for sandwich lease options is a subject covered thoroughly in the course material. But I don’t often cover buyers in my blogs because most of the time the place you want to begin is with sellers. However, that’s not always the case. Buyers can be the path to great success right from the beginning. Here is how you do that…
Finding the right buyer is an important part of the success formula.
Basics of Marketing to Sandwich Lease Option Buyers
This might seem counter-intuitive but there are many insights that you gain by running advertisements for sandwich lease options buyers, even when you don’t already have a seller. These are the types of things that I’ve learned through decades of experience and two-way sharing with thousands of students.
To start with, Craigslist remains the go-to media when marketing for buyers. I’ve tried paid ads in newspapers but ads on craigslist cost nothing and are much more productive. I don’t like saying I do anything 100% but for the most part, all of my marketing for sandwich lease option buyers is on Craigslist.
Here is a brief list of what you can learn from sandwich lease option buyers simply with a few telephone conversations.
- Test your local market to determine the interest in sandwich lease options or rent-to-own arrangements.
- Build a list of future buyers to match with sellers as they come along.
- Learn details about the type of houses that sellers are looking for so that you can fine-tune your search and marketing for sellers.
- Learn details about the neighborhoods that buyers are showing the most interest in.
- Build a list of specific attributes that buyers are willing to pay the most for in a house.
You will gain even more insights by having conversations with different buyers.
Example of a Conversation with a Sandwich Lease Option Buyer
You’ll never know exactly what to expect when you start a conversation with a buyer but the more conversations that you do have, the nimbler you’ll become at learning what their needs are and what adjustments will work best in your sandwich lease option program.
Here is a summary of a conversation that I had with a man named Barry who responded to general ad offering rent-to-own arrangements. I assumed that buyers were mostly interested in while picket fence houses in the suburbs. And they are, but Barry was an exception that I wasn’t expecting. Barry was looking for something rural in an agricultural setting. He wasn’t looking to become a farmer, but he worked from home and didn’t need to be close to the city. He did want a 3-bedroom, 2-bath white picket fence house but he wanted in on 10 to 25 acres. Preferably with a pond, a shop, and an outbuilding or two.
I also learned a lot more. He said he had a $10,000 down payment and $1,200 a month rent was no problem. Learning that, I knew that he had to have some credit problems, or he would just buy the property using a traditional purchase. Once I knew that he had money for a sandwich lease option, I politely asked about his credit situation. Barry had never been foreclosed on, had never filed bankruptcy, and had never been evicted from a rental. A sandwich lease option will work with all of these, but it can take time for these to fade into a distant history. What Barry did have on his credit report were several late pays. He had missed several payments. This brought his credit score down below what qualified for a mortgage. But it was also a situation that working several months with a credit counselor would return his credit rating to “mortgage qualified.”
Barry is a great candidate for a sandwich lease option!
So, what did I learn? I learned that Barry is a great candidate for a sandwich lease option. I learned how much he had for a down payment, I learned how much rent he can afford, and I learned a lot more. Although he didn’t fit my preconception of a suburban house, he had all the other qualifications. If I decide to expand the market that I operate in, I now know that there is some interest in rural properties. I also know people currently doing sandwich lease options in the areas that Barry is interested that I can pass this lead on to. During our conversation, I shared with Barry that he is a very good candidate for a sandwich lease option, and I also shared information about how these work. Barry said that now that he understood it better, he would tell a couple of people he knew that are in similar situations.
Although I didn’t have what Barry is looking for, I’ll gain work-of-mouth advertising when Barry shares what he has learned with family and friends.
Marketing for Buyers When You Have a Seller
When you have a seller and are looking for a buyer, you want to run ads giving a general overview of the house but don’t provide specific pictures or the address. There are good sandwich lease option business reasons for this. First, you don’t want potential buyers to not call on your ad simply because it isn’t an exact match for what they are looking for. It could be that you simply failed to mention something in your short ad that is important to them, it has another feature they want but you didn’t mention, or it is a close match but not perfect. You want these buyers to call you. You can learn from them. Even if they don’t buy this house, you can include them on your buyers’ list and get back to them when you have their perfect house.
You do want to be fairly specific about the neighborhood even if you’re not specific about the particular house. You can learn a lot about how attractive this neighborhood is to sandwich lease option buyers in general. You can also learn about the price point that house in the neighborhood will sell for using a sandwich lease option or a cooperative lease option.
The number of calls that you get tells you a lot of information.
Keep track of the number of calls that you receive. Keep taking calls even if you put the first caller under contract. If you get zero calls, either the neighborhood is not attractive to buyers, or your price point is too high. If you get 20 calls, your price point might be too low, and you do want to look for more sellers in this neighborhood. If you receive 5, 10, or 12 calls, you’ve probably hit an average. Your price point is good, and you have a desirable neighborhood. Still, you can take a closer look at the way you word the ads to get more responses. Maybe 3 out of 8 calls were interested in the school district or the easy commute into the city. Those are marketing cues that you can use in future ads and when you talk to prospective buyers on the telephone.
One thing that I have learned about attracting sandwich lease option buyers is that “romance sells.” Include phrases in your advertisements like “beautiful sunsets,” “gorgeous lake side setting,” or “includes hot tub.” You can run multiple ads to see which types attract the most callers or the best qualified callers. Other things to emphasize are credit issues and specific locations. There are many effective ways to reach qualified buyers.
You’ll soon have as many buyers as you want. So remember, finding good tenant-buyers is the key to making a sandwich lease option deal successful.
Anyone can succeed with sandwich lease options! And here is where you begin. What you need to do now is TAKE ACTION!
- Strategies for Buying and Selling with Lease Options.
- You’re Wealth Building Arsenal.
- Investing In Real Estate with Lease Options.
- Cooperative Lease Options.
- Add Personalized Coaching.
- Expand to Get the Deed “Subject To.”
- Round it all out by Working with Realtors.
By Wendy Patton
For more than 30 years, I’ve used the Sandwich Lease Option System to earn myself and my students millions of dollars. From my experience, I know there is plenty of room and opportunity in the real estate investment market for everyone wanting to participate to find profitable deals. It’s because of that fact and my personal success that I share the Sandwich Lease Option System with others.
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