If you have a listing or own a house you can't sell right away, a lease purchase is another option to consider.

I personally have done several lease purchases over the past few years both with my listings and with investment properties I've owned.

I currently have two lease purchases going on; one is set to close next Wednesday, my sale and my listing; and the second is going to close this coming April.

A true, well structured lease purchase is a good deal for both buyer/lessee and owner/lessor.

First of all you need some paperwork. For a lease purchase I use and highly recommend three separate documents.

1. A sales contract spelling out exactly the terms of the purchase; this can be similar to a regular sales contract.
2. 2. A lease agreement spelling out exactly the terms of the lease while the lessee/buyers are living in the property prior to purchasing it.
3. A tenant information form with some information to allow you to positively identify your tenant/lessee, i.e. drivers license numbers, social security numbers, and a statement authorizing you to verify all the information AND obtain a consumer credit report.

If your state or local association does not provide any forms for lease purchase you need to consult with a qualified attorney to have them drafted. DO NOT write your own for a seller client; you (as a Realtor) are not permitted to practice law.

Your purchase and sales agreement for the lease purchase needs to spell out:

• This is a lease purchase
• Purchase price
• What's included
• Any closing costs to be paid by seller/lessor
• Earnest money, who holds it
• Inspections. These need to be completed and signed off on by everyone before the buyer/lessee moves in.
• I think it's a good idea to give your buyer/lessee a home warranty beginning on the date of occupancy and make them responsible for repairs, upkeep, and maintenance.

Your lease agreement needs to spell out:

• Property, what's included, i.e. blinds, fireplace logs, etc.
• Lease terms, how much a month, does any apply towards purchase price.
• Security deposits if any. I usually make this part of the non-refundable down payment.
• Repairs and maintenance. My buyer/lessee does this after they move in.
• Insurance, they need a renter's policy since they can't legally get a homeowner's policy yet.
• Number of people that live there and their identity.
• What constitutes default on the lease
• And any other clauses or information your attorney may advise you to include

The Tenant information form needs to include at minimum:

• Personal data, name, ss #, driver's license #, occupation(s), employer, references, and credit references.
• A few simple questions like have you ever filed bankruptcy, been evicted, willfully refused to pay rent, etc.
• And the following statement: "I declare the the foregoing information is truc and correct, authorize it's verification, and the obtaining of a consumer credit report. I agree that the Landlord may terminate any agreemtn entered into inreliance on any misstatements above."

A lease purchase, like a sale, does not always work out for whatever reason, but if you do some advance preparation, qualify your buyer/lessee carefully, and make sure both parties actually want it to work out your chances of success (and getting paid) go way up.

** NOTE TO TENNESSEE REALTORS ** TAR makes all the necessary forms available on the TAR website, you need forms F 57,58, & 59

Consumers can search for Knoxville, Tennessee area lease purchase opportunities at KnoxvilleHomeCenter.com

I found this fascinating quote today:

What caused you to buy your house? Is it close to a popular Knox County school, shopping, in a great area. Whatever the reason most buyers will likely be attracted to the same things, make sure they know about them in your advertising.

You should read the whole article here.

It's easier than you might think.

1. Find a qualified Knoxville area Buyer's Representative: Since most of us only buy real estate a few times in their lifetime doesn't't it make sense to have a Buyer's Representative to provide complete and fair representation for you? The sellers already have a listing agent to look out for their best interests. As an Accredited Buyer Representative (ABR), I'm qualified to consult with you about buying and represent you.
2. Read the rest of of this Knoxville homebuying article here
   

Here's an oldie but a goodie from a last year's post that bears recycling.

Each time you have a closing make 2 extra copies of the closing statement.

Write the buyer and seller each a letter dated January 2^nd of the following year that says something like:

Dear Tom and Denise,

Before you know it tax time will be on us again.

To save you some time (and hopefully some money) I'm enclosing a copy of the closing statement from the real estate transaction we had this past year.

As you probably know some of these expenses could be tax deductible; your accountant or tax preparer can best advise you as to which ones.

I hope this is a benefit to you as you prepare your 2007 tax returns.

If I can be of further service to you or your friends & family in any future real estate transactions please give me a call or e mail

Thank you once again for your business in 200X.

Best regards,

Jim Lee, REALTOR®"

Sign the letters and put them along with the closing statements into a large folder each time you have a closing. When January 2^nd of the following year rolls around just get them out, put the appropriate postage on them, and drop them in the mail.

This is usually good for 1 or 2 extra pieces of business a year.

And yes, I send them to both sides of the transaction whether I was their broker or not. It is not unethical to solicit someone's future business just because they may have had an agency relationship with another licensee in a past transaction.

Additionally I can almost guarantee you the other side won't be sending them copies of the HUD 1 anyway and they will appreciate you for remembering them.

Serendipitously I came across a potential solution to the feedback problem: Home Feedback.com that will automate feedback for the listing agent and make your life easier.

For a mere $19.95 a month the Home Feedback.com folks will:

• Let you set up a separate account for each of your listings on their servers.
• When a showing is scheduled you just log the showing agent's name and email into that listing's account.
• The system then takes over and sends an email to the showing agent with a short (7 multiple choice questions and 1 comment blank space
• The system sends a total of 3 emails to each showing agent until they respond.
• When they respond the system sends an email to your sellers (if you tell it to) with the questionaire filled out with a copy to you and also keeps a graph of the answers so if you get the same answer to one question, i.e. "Price too high" the sellers can see that visually and perhaps call you suggesting a price reduction.
• It (the system) also reports on unfulfilled showing feedback requests so your sellers can see where you tried multiple times to work on their behalf but that ol 'other agent' just won't cooperate.
• Another great feature is if something changes on your listing, i.e. a price reduction, you can send out a 'blast' email to everyone that's ever showed it notifying them of that change.

I signed up yesterday and have already used it on 5 showings and got one feedback form already. It's still pretty early to make any judgements about how it will work for me but I'm impressed so far.

21 day free trial if you're interested.

The Knoxville Area Association of Realtors released the February 2007 sales report yesterday.

The DOM (days on market) have increased from 91 in January to 94 in February and new listings dropped from 2,697 in January to 2,455 in February.

Knoxville area 2007 Febuary Sales Report

So less listings for sale and they're taking longer to sell. That tells me we're still in a buyer's market and it's getting stronger.

If you're in the market for a new home or investment property in the greater Knoxville Tennessee area it's a great time to buy. Interest rates are still very attractive, selection is great, and motivated sellers are making some great deals to move their homes.

Visit my website, KnoxvilleMLS.com to view all Knoxville's Realtor listings and then give me a call to talk about buying a new home or investment.

The sales statistics for the greater Knoxville Tennessee are released around the 15 of each following month.

Click here to see what happened this past month.

There was a total of 958 single family homes and condos closed in January of 07.

Days on the market were up a bit to a 91 day average.

Get all this data plus what it means to you if you're selling your Knoxville TN area home  here.

If you've always wanted to test the real estate investing waters for fun & profit it's still possible to do that successfully in the greater Knoxville, Tennessee area.

Here's a before photo of an actual northwest Knoxville house we bought in 2006 for $71,000

And here's the same house after our rehab

We sold it 3 months later for $130,000

Visit Knoxville Tennessee Real Estate Blog for the whole story and then contact me to get started investing for fun & profit.

Timely tax tips are now posed at the Knoxville Tennessee Real Estate Blog.

Did you know you may be able to sell your current home and not pay any captial gains taxes on gains up to $500,000?

Do you know how to sell your current home to yourself, create a new rental property, start depreciating that property, AND still benefit from the $500,000 capital gains exclusion?

Real all about it at: Knoxville Tennessee Real Estate Blog.