The Lease Solution

lease

In 1992 an up and coming real estate investor/agent found himself over his head in the commercial real estate market — $5 Million in debt!  He couldn’t pay back the loans for his commercial real estate projects.  At the same time many developers were getting out of commercial real estate because the market was collapsing.  Not a single banker would negotiate or restructure his debt.  His loans were causing him such a headache he couldn’t pay his bills including his mortgage.  He had to downsize immediately!  So he put his house on the market before serious trouble ensued.  But he didn’t try to sell his house.  Instead he recognized that his home had value and if he could find a suitable renter, it would allow him to return to his house after getting his financial situation in order.  He consulted several colleagues and determined the best idea was to find a tenant that would pay a full year of rent in advance.  This strategy would allow him to keep his house, even though he would have to move out temporarily.  He called every realtor he could think of and asked if they could knew of a renter who could make a full years worth of payments — up front.  Weeks passed when one morning an associate learned about an athlete who had just retired from sports and was between home purchases.  The athlete wanted to take a couple years to make her next buying decision.  After walking the property the athlete said “I’ll take it.  Would you be ok if I signed a 2 year lease?”  The investor/agent couldn’t have been more excited.  In actuality the athlete liked the home so much she actually stayed much longer.  This gave the investor/realtor the time he needed to rebuild his residential real estate business, which at that time was his only source of income.  It took 8 years — but he did it!  Eight years after he had left his home he was able to move back into his residence which had never gone into foreclosure.  Foreclosures are on the rise again.  If you come across someone facing financial strife please refer them to this blog.  There are more and more solutions available to ease the burden and solve the problem at hand!

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