How to find Motivated Sellers for Lease Options

What Makes a Motivated Seller

There are, of course, different circumstances and situations in the lives of people that motivate them to need to sell their home.  This can include a job transfer, bankruptcy, foreclosure, divorce or upgrading to a bigger home -- any number of reasons.  However, the circumstances of the sellers may also be affected by the state of the two vying economic real estate markets – buyers and sellers – which also affect seller’s motivations.  For real estate investors it is crucial to buy homes from truly motivated sellers -- sellers who have an extra urgency, usually financial, however, not always.  You can’t get a good deal from a seller that is not motivated, because, they will have no reason to negotiate any part of a transaction.

There are different degrees of motivated sellers and different reasons sellers need to sell their homes, but overall there are two basic categories of motivated sellers:

1.         Desperate and distressed (bad debt) – someone in trouble financially, behind on payments, going in a bad direction, lost their job, divorced, foreclosure, etc or

2.         Not desperate or distressed (good debt) – someone not in trouble financially, not behind on payments, but motivated for other reasons: possibility have two house payments, inherited a home, burned out landlords, job transfers, etc.

Most real estate investors only go after #1 above, but there is also huge profit potential with sellers that fall in #2.  All of the lease option sellers should fall into number 2, because these sellers are safer for a lease option buyer.