How to Give Sellers the Full Asking Price with a Sandwich Lease Option

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An immensely powerful advantage to investing with sandwich lease options is your ability to offer the full asking price to the seller! If you are an investor that is used to looking for deeply discounted houses, being able to offer full market value opens an entirely new world of opportunities to you. If you are new to investing, you want to begin from a position of power!

There are many opportunities to leverage your profit AND pay the seller’s full asking price.

For clarity, the full asking price must be at or below the amount the house will appraise for. But you can pay the full market price and make a handsome profit.

The Selling Price Can Make or Break a Deal

Make no mistake about it, the selling price is very important to the seller. It isn’t always the most important part of the deal but very often it is the most important number to the seller.

Let me be clear. At other times, the most important thing might be stopping the seller from hemorrhaging money. They may have been paying the mortgage on a vacant house for months and their savings account is empty. The most important thing to this seller is probably getting a paying tenant-buyer into the house tomorrow. A sandwich lease option will also fill this bill.

Before offering full price, listen to what is most important to the seller.

Sandwich Lease Option Investors Don’t Care About Loan to Value Ratios

This is a great example of why it is so much better to control a property without owning the property. Remember, sandwich lease options enable you to control the property without owning it. One of the many advantages of this is that you don’t need to take out a loan or a mortgage (no credit needed).

Landlords, rehabbers, and other investors have to buy the house outright. Buying outright almost always requires taking out a mortgage. When you take out a mortgage, you must overcome the hurdle of the ‘loan to value ratio.’ The loan to value ratio is the amount of the loan compared to the market value of the house stated as a percentage.

The loan to value ratio shows up all over the place in real estate deals but NOT in your deal with the seller when you use a sandwich lease option.

Again, I like to be clear because the loan to value is important to the tenant-buyer in a sandwich lease option. But it is not part of your contract with the seller.

You’re probably familiar with the 20% down payment requirement to qualify for a mortgage. That 20% is almost always closer to 3.5% in the real world for tenant-buyers but that is a different story. What’s important here is that the 20% or the 3.5% is the loan to value ratio. This means the bank is only going to loan 80% or 96.5% respectively of the house value. The tenant-buyer will need to meet this requirement. But as a sandwich lease investor, you’re not borrowing to pay the seller. The loan to value ratio does not apply to your deal with the seller.

Here’s why this allows you to pay full price to the seller…

Other investors like landlords and rehabbers are not going to get a loan with a 96.5% loan to value ratio. Those loans are only for buyers who will be making the home their primary residence (tenant-buyers fit this bill). Other investors are lucky to get a loan with an 80% loan to value. More likely, it will be closer to 70%. That means these other investors need to cover the other 30% of the value of the full market price. They have two choices. They can pay it out of pocket (30% of $200,000 is $60,000). Or they can buy the house for less than market value. This is the deep discount other investors are looking for. It means these investors will be offering the seller $140,000 for a $200,000 house.

Sandwich lease option investors can offer the seller the full $200,000 when other investors are only offering $140,000. That’s the power of control without owning.

Multiple Ways to Profit Handsomely with a Sandwich Lease Option

You might be asking how you are going to make a handsome profit if you pay the seller the full market price, and the tenant-buyer also pays the market price. Here’s where the tremendous power of creative financing with sandwich lease options really makes its mark!

It’s all in how you write the contract terms with the seller and the tenant-buyer. For instance, home values have been appreciating in value at incredible rates for the past several years. When the tenant-buyer’s lease period expires in two years, you can reasonably expect the home value to have increased by between 15% and 20%. You can sell it to the tenant-buyer for that much higher price when they qualify for a mortgage in two years. On a $200,000 home, that 15% to 20% amounts to between $30,000 and $40,000, respectively. That is only part of your profit that also includes the other paydays that you collect along the way, but only with a sandwich lease option.

And… there is the seller’s equity.

Let’s say the seller has a $150,000 mortgage on the house that you are paying the full $200,000 for. The seller has already been paying that mortgage for 10 years. During the two-year lease option period, the seller will be increasing his/her equity in the house an average of $332 each month. That amounts to about $8,000. There are ways to write the contract with the seller so that equity is paid to you when the deal closes with the tenant-buyer. You still pay the seller the full $200,000 asking price but you receive the increase in the equity.


There are other ways to pay the full asking price and still make a handsome profit. Another is having all your rent payments to the seller apply to the sales price. On a $200,000 house, this can amount to $30,000 or more!

Take Action Right Now to profit with sandwich lease options in all the highly creative ways available!!!

  1. Investing In Real Estate with Lease Options.
  2. Advanced strategies for Buying and Selling with Lease Options.
  3. You’re Wealth Building Arsenal.
  4. Working with Realtors
  5. Cooperative Lease Options.
  6. Add Personalized Coaching.
  7. Expand to Get the Deed “Subject To.”.

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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What is a Subject-To?

Subject-To deals, short for “subject to existing financing,” involve the buyer taking over the existing mortgage payments on a property without formally assuming the loan.

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