Dominate Lease Options with This Guide | Episode 11

Send us a text

Unlock the secrets to successful lease options in real estate with Tim Yu, an army officer turned savvy real estate investor. Discover how Tim transitioned from his first fix-and-flip project to owning nine buy-and-hold properties, all through creative financing. Learn the ins and outs of lease options, including how they offer a path to homeownership for renters while providing property owners with higher purchase prices and tax benefits. This episode promises to deliver valuable insights into the practicalities and benefits of lease options for both seasoned investors and newcomers alike.

Dive into the strategic approaches that make lease options a win-win for all parties involved. Tim Yu shares his expert advice on negotiating lease options, offering three-to-five-year terms with annual renewals based on tenant performance. Understand the importance of factoring in appreciation rates and setting future purchase prices. Discover effective methods for finding and screening potential tenants, and why a three-year lease term is crucial for giving tenants adequate time to secure financing. Tim also emphasizes pairing tenants with credit repair services and mortgage lenders to set them up for success.

Explore the emotional and financial aspects of lease options and how they can serve as a creative solution for real estate problems. Learn about structuring lease option fees, mitigating risks for sellers, and the "lease option sandwich" strategy that allows investors to create passive income with minimal costs. Tim's real-life examples and practical tips bring to light the benefits and potential pitfalls of lease options, ensuring a comprehensive understanding of this innovative real estate strategy. Don't miss this opportunity to expand your real estate knowledge and discover new ways to achieve your investment goals.

✅ Follow on Social Media for more real estate insights:

⁠YouTube⁠

⁠Instagram⁠

⁠Facebook⁠

Episode Transcript

Joseph Marohn (00:12):
What up everyone and welcome back to the Real
Estate Unlocked podcast.
I am your host, Joseph Marohn,and today we're going to be
covering a highly requestedtopic in real estate.
One would even argue a betteroption than your traditional
rental, a strategic way to sellyour property at a higher
purchase price.
Today we're going to becovering the topic of lease

(00:34):
options.
A lease option is an agreementthat gives the renter a choice
to purchase the rented propertyduring or at the end of the
rental period.
It also precludes the ownerfrom offering the property for
sale to anyone else, which is ahuge benefit for the renter if
they are looking to purchase ahome but need a little time to

(00:54):
rebuild their credit.
This agreement usually requiresthe renter to pay an upfront
fee for the right to purchasethe property at a later date.
It's a huge benefit for bothparties and, if utilized
properly, it can open up a lotmore doors for your real estate
business.
Now, if that sounds appealingto you, this episode will cover

(01:17):
everything you need to knowabout lease options, how to
structure one yourself and howyou can start utilizing this
creative strategy today.
Now you know how we do it onthe Real Estate Unlocked podcast
.
If we're going to do it.
We got to do it right.
We can't just bring on anyoneto speak about lease options.

(01:37):
We got to bring on the onewho's killing it in lease
options.
Today, our special guest on thepodcast is Tim Yu.
Tim's real estate journey beganin 2022, with his first project
being a fix and flip.
He's also a full-time armyofficer, located in Louisville,

(01:58):
kentucky.
Over the last year alone, he'smanaged to purchase nine buy and
hold properties utilizing thepower of creative finance.
He's also an active member inthe Sub2 community with Pace
Morby, and today he's going toshare with us one of his
favorite ways to grab rentalsthe lease option.
So, without further ado I'vebeen talking long enough

(02:23):
Everyone.
If you will, please allow me toformally introduce to you Tim
Yu.
Tim, what up, brother, how'syour day going, yo?

Tim Yu (02:35):
what's up, bro?
It's going great, man Dude.
That was probably one of themost killer intros I've ever
heard on a podcast man, so Iappreciate it, brother, I
appreciate you man.

Joseph Marohn (02:44):
Yeah, I've been having a lot of fun with these
intros.
I've been getting a lot of goodfeedback.
So having fun with it, man, andI appreciate the kind gesture.

Tim Yu (02:54):
Yes, sir.
Well, I appreciate you invitingme on the show man and I'm
excited to talk some real estatebrother.

Joseph Marohn (02:59):
Hey, I'm excited too, man.
Awesome.
Well, Tim, welcome to thepodcast.
First things first.
Thank you for your service,brother.
It's always an honor to have aveteran on the show.
So thank you for everything youdo for our country and thank
you for taking time out of yourbusy schedule to help us break
down such an amazing strategy toknow in real estate.
As you already know, withcreative finance, the

(03:22):
opportunities are limitless.
Lease options are just anothertool to have in your investing
arsenal.
Not only can you make a ton ofmoney doing it, but you're also
helping out people along the waywho may not be able to qualify
for a mortgage right now, whichmakes it a win-win for both
parties, and I'm pumped that weget to break this topic down
together.
So thank you.

Tim Yu (03:43):
Yeah, man, the ask away.
I love to talk about it.
It's kind of what you alreadytalked about in the intro right.
The lease option is so greatfor the tenant, buyer, the
person that's actually rentingthe property and owning the
property, so I'm sure we'll talkabout it more in depth.
But I freaking love this way tostructure deals, man.
It's absolutely incredible.

Joseph Marohn (04:02):
I love it too, man.
So, tim, you ready to drop somegems?
Let's do it.
All right.
All right, let's get into it.
So before we really dissectthis topic, I'd like to talk
about you and your journey for asecond.
You've been getting a lot ofspotlight lately.
I see you doing your thing onPace Morby's Get Creative
podcast.
I also saw you on Pace'sYouTube live breaking down a

(04:23):
deal you did where thewholesaler started ghosting the
seller.
But, tim, how did you startyour journey, man?
What made you want to get intoreal estate, and what are you
currently focusing on in yourbusiness?

Tim Yu (04:35):
Yeah, it's.
You know I get this question alot.
It's been a crazy 15 ish months, but you know.
So you know I'm an army officerdown in Kentucky and I used to
commute to Fort Knox every day,so that's about a 50 minute
commute each way and you knowthe corny stuff like you know.
You listen to all the podcasts,you know Bigger Pockets, you

(04:56):
know Get Creative.
All that stuff kind of got melike wanting to get started in
real estate, real estate, andlistened to the podcast for
about a year until I decided,hey, I need to get started in
real estate and let's go try todo something.
So I linked up with a realestate agent and I was on Zillow
every single day just creepingon deals and I saw a house that

(05:19):
was listed for a hundred grandand it dropped to 50 grand
overnight.
So we went to go see thatproperty immediately and it was
boarded up, had a squatter inthere and all that, and the
owner was from LA, so I knowyou're from California, so it
was kind of funny that theseguys are buying up properties in
the Midwest.
So he didn't want to deal withit anymore.

(05:40):
It was beat up.
So I bought it for 40 grandcash.
So I used the hard money and allthat stuff and people have
heard me talk before it was nota good deal.
So I think I made five grand insix months.
So you would imagine how muchwork and pain that was.

(06:01):
So after all that stuff, wemade that $5,000 and I was about
to quit real estate.
So I was like man, I'm donewith this stuff.
This was not worth it.
I ran into a sub two student ata sub two meetup and that's
kind of like where how I gotstarted in that stuff, where I

(06:22):
met somebody that I trusted andI ended up dumping all my flip
money into that mentorship andthen that really all the stuff I
learned in there kind of likescaled my portfolio from there.

Joseph Marohn (06:34):
Dude, that's interesting.
Well, first off, you know, yousaid you know I'm from Southern
California, right?
So we don't, a lot of usinvestors, we don't buy in
California.
Not to say that all investorsdon't buy in California, but the
house pricing here is likethrough the roof, right.
So a lot of times we findourselves buying out of market,
you know, in other markets likeTexas, you know Midwest states.

(06:55):
But it's interesting the factthat that was 100K and they
brought it down to 50K.
What was the reason for that?

Tim Yu (07:02):
So there was a squatter that actually broke into the
house.
Oh, and you know, when youwalked in that house, dude, it
was like you saw the sketchieststuff in there, you know what I
mean?
Like like some paraphernaliathat you don't want in a house,
right?
So it's like the owner was justlike hey man, I'm out on the
west coast, it doesn't make thatmuch money, you know, it's set

(07:23):
six hundred600 a month in rentand for me I thought it was a
great cosmetic flip and the riskwas really low.
So I said you know what, let's,let's try it.
But I made all the typicalmistakes, you know, like bad
contractors and all that stuff.

Joseph Marohn (07:37):
So yeah, you know , um, sometimes I see some of
these pictures right from, like,some of these houses and I'm
like, dude, it looks likesomething out of a horror movie.
It's crazy, you know.
And then, um, but yeah, Ireally love the fact that you,
you know, you talked about how,hey, I only made 5,000 on this
for six months and a lot ofpeople would give up, right, and
you said it yourself, youwanted to give up, but you kept

(08:09):
pushing forward.
And that's great, man, becausewe got to fail forward.
We're going to make mistakesalong the way, but the key is to
kind of learn from thosemistakes and keep pushing
forward, right?
So, absolutely, yeah, greatstuff, man, great stuff.
So let's give the people whatthey came here to see, shall we?
What exactly is a lease optionand how does it differ from
traditional property buying orrenting?

Tim Yu (08:23):
Yeah, so lease option is kind of exactly how it sounds.
It's a lease, so someone'sactually going to rent the
property from you, and then theoption, so they have the option
to purchase the property fromnow to a set amount of time,
right?
So?
And the difference between thatis, let's say, when you buy a
house traditionally, you knowyou're getting a mortgage or

(08:45):
you're doing creative finance.
You're buying the property, youget the deed the person who's
renting from you as a leaseoption tenant buyer they don't
get the deed until they qualifyfor an actual mortgage down the
road and then pay you off andthen it'll be a normal
transaction from there.
So how I explain things, theeasiest way is they're
essentially renting from you.
They give you a non-refundabledown payment Well, it's not

(09:09):
really a down payment, but it'sthe non-refundable deposit for
the option fee that eventuallybecomes a part of the purchase
price, which equivalents to adown payment down the road, and
then it becomes a normaltraditional sale, like they

(09:30):
qualify with a mortgage lenderand then we go to a closing
table and then they get the deedand they own the house and I'm
out of it.
The great part about it for usas the investor is we're more
hands off in terms ofmaintenance.
So it's very state dependentdepending on the rules and the
regulations.
But for us, you know everythingover $500, I take care of

(09:51):
everything under $500, thetenant buyer takes care of.
So it saves a lot of pain onthem calling you for, like you
know leaky toilet or you knowsmall maintenance stuff.
You just don't have to dealwith it because they're okay
with taking care of it, becausethey're eventually going to be
the property owner.
The second thing is obviouslythe non-refundable down payment.

(10:11):
If you're putting 10, 20,000down, do you think you're going
to kick a hole in the property?
No, I don't think so.
They're usually going to takecare of the property.
Also, for every tenant that Iput into my homes, I tell them
that this is your house.
Right, this is, this is yourhouse.

(10:32):
So you know, take care of it,do what you want with it.
You know, as long as you'rebuilding your credit and you're
paying your rent, you're good inmy books right, awesome.

Joseph Marohn (10:41):
And just to clarify, like you said, it's two
separate agreements, correct?
That's being combined together.
So there's the lease agreementand then there's the option to
buy agreement.

Tim Yu (10:51):
Yep Absolutely Two different documents.

Joseph Marohn (10:54):
Okay, great man.
So can you kind of walk usthrough the structuring of a
lease option agreement?
How does that start from A to Z?

Tim Yu (11:02):
Yeah.
So I think it's like dealer'schoice, right?
Like how long do you want tohave that option, how long you
want to keep that house kind oflocked up?
Right, because when you sign alease option agreement, that
option contract prevents youfrom selling it to anybody else.
So that's the beauty of it forthe buyer as well, because they

(11:24):
have that sense of security thatfrom three to five years,
wherever you agree to, thathouse cannot be sold to anybody
else and I can't change theprice.
So wherever we set the price to, that's what they're going to
pay.
So for me, on the investor side,I like to do three to five
years.
I allow the seller or the buyerto have three to five years to

(11:46):
buy the house, but to kind ofremain in control, to kind of
avoid myself from falling into a.
You know, a tough.
Tough situation is I have oneyear option contracts and then
if the, if the tenant isperforming, paying on them,
paying the rent, actively,trying to improve their credit
score, I will extend theiroption for free.

(12:09):
There's no fees or anything.
I just have that as acontrolling mechanism just in
case that tenant just goes offthe rails and stops
participating in the program.
Right, because you don't wantto trap yourself Now.
I usually like to do athree-year option, so you set
the the price.
So how I usually do it is Ikeep things fair that I add

(12:30):
three percent appreciation forevery year.
So if they're, if they're gonnabuy, if they tell me, hey, I
need three years to buy thishouse, I'll probably add nine to
ten percent appreciation on thepurchase price on the back end.
Right, if they don't exercisethe option in three years, we
just have a conversation.
We go, hey, are you close?

(12:53):
Are you still trying to do this, are you not?
And if they say that they wantto do it, then we'll renegotiate
a new purchase price.

Joseph Marohn (13:00):
Awesome.
Yeah, that's smart that you'refactoring in that appreciation
for the future, right?
So you're factoring that 3%over three years if you're doing
a three-year lease three ways.

Tim Yu (13:27):
You're getting paid upfront with the down payment,
you're getting cash flow fromthe rental and then you're
hoping to get paid on thebackend with the appreciation
you forced into the property.

Joseph Marohn (13:34):
Right, and so at the end of the terms, the buyer
still needs to qualify for theirown loan, correct?

Tim Yu (13:40):
Yep.
So what we like to do and likethis is what I suggest.
So to also protect you as theinvestor, right?
You want to make sure that thattenant is set up for the best
way possible to be able toqualify, because you don't want
to be predatory, you don't wantto take a down payment and hope
that they're going to not buythe house on the road so you can

(14:02):
like redo it right.
So what we like to do is hey,if you're in our local market in
Louisville, which is where I domost of my stuff now is we
actually pair you up with acredit repair person that that
helps that person plan out theirfinances and gets their stuff
repaired, their credit score.
And then we also pair them upwith a mortgage lender that I

(14:22):
work with for my deals and alsothat understands the lease
option process, so that theyknow that that payment that they
give me should count as thedown payment when they go
qualify for that conventionalloan.

Joseph Marohn (14:36):
Yeah, that's awesome, man, because you're not
looking at it just as like aninvestment, right, but you're
also looking out for the tenantas well by finding them those
available options for them.
That's great, man.
I love that.
So how are you exactly findingthese tenants that purchase a
property and how are youscreening them?

Tim Yu (14:54):
Yeah, so screening is a little different.
But let's, I guess we'll startoff with how I find them.
It's actually as easy, I findthem.
It's actually as easy as easierthan you think it is.
So Facebook marketplace and weadvertise as a rent to own

(15:15):
straight up, and then we alsopay for ads.
The reason why we pay for adson Facebook is because there's a
lot of bots and spams out thereand we want to give the tenants
or the people looking at thehouse to realize that we're real
right, because usually scammersdon't pay, you know, $30, $40
on ads.
The second way is we actuallylist their properties on all the
free property managementsoftware like Avail.
Like, have you heard ofAvailcom?

(15:36):
I have Yep, so I actually listall my stuff on there as well
and label it as a rent-to-own.
The third and most effectiveway I kid you not, dude is
bandit signs.

Joseph Marohn (15:48):
Bandit signs Good old bandit signs.

Tim Yu (15:50):
That orange arrow that says rent-to-own and you have a
couple of them leading to yourhouse and right in front of the
house is rent-to-own.
Call this number and I probablygenerate the most leads from
the bandit sign, honestly, andyou'll get like like on Facebook
Marketplace.
I think I get like 40, 50people that message me in like a

(16:11):
day.
So it's crazy.
But how you screen them iscomplicated because there's so
many people.
So like, for instance, like ifyou're doing it yourself, like I
did, I just had a pre-generatedmessage that had all the
instructions.
Instead of individually DMingevery single person, I just sent

(16:31):
them this gigantic paragraphand that cut out half the
tenants because half the peopledidn't want to read it.
That's right.
I was okay with showing theproperty first and then talking,
because in my instructions Isaid, hey, go see the property
and if you like it, then contactme back, because there's no's

(16:52):
like available for an hour.
So like when they go show orwhen they go see the house, they
have an hour to go see thehouse, right?
So I'm like I'm trying toautomate everything.

(17:13):
Once they tell me that theyhave, you know, they like the
house, they want to move forward.
We do the background check.
So we don't necessarily care asmuch about credit.
We care about how much moneythey have because they have to
pay rent.
And then, second, we just wantto see if they got some crazy
stuff under the hood.

Joseph Marohn (17:34):
Okay, got it so, and I know you said three years
is what you typically target.
Is that like the standardduration for a lease agreement?

Tim Yu (17:43):
I mean some people do one year, Some people do two
year.
I just feel like that timeframe is too short, right,
because it takes time to buildcredit, right?
I think three years is arespectable amount of time for
someone who is seriously tryingto build credit can actually get
the job done.

Joseph Marohn (18:05):
Who's seriously trying to build credit can
actually get the job done,Because I think I see some
people do five years and so Iknow like three years or five
years one year, like what isthat standard duration that
people would typically use?

Tim Yu (18:15):
Yeah, so you're right, people do do five years and it
really is.
I think from the three to fiveyear timeframe is like the
standard, like industry averageright now, because I remember
like after my three year mark Iactually negotiate with the
tenant to see if they want tostay Right, and I'll allow them
to go even higher than five, sixyears Right.

(18:36):
It just depends on what theconversation is and what their
situation is like financially.
But really, though, when itjust comes down to screening is
hey, do they have enough incometo pay rent?
And do they have enough, youknow, so they don't go under
right, because you don't wantthem to like not pay rent, and
then you know, now I'm evictingthem and that's even worse on

(18:57):
their credit score and history.
We want to make sure thatthey're good financially.

Joseph Marohn (19:01):
So Are you opening escrow on lease options
or is it directly between youand the buyer?

Tim Yu (19:07):
So for me it's between us and the buyer until we go
actually qualify for the loanand actually go sell the
property.
So what we do is we notarizethe property or we notarize the
option agreement and the lease,and then we have a relationship
with the closing attorneys andtitle companies, so we always
close the same one.
So when I tell the tenant buyerlike hey, this is what we're

(19:29):
going to close, and they havecopies of all the paperwork as
well, so it's like you knowwhat's notarized, you have the
copy and you know what we'regoing to close, right, and then
also they have the loan officersinformation as well that also
understands what we're trying todo as well.
So it kind of like I can't scamthem, right, like even if I

(19:50):
wanted to, like there's too manypeople involved and that's how
we want it right.
We want tons of third partiesto be involved in this situation
, this deal, just to protectmyself and protect the buyer, if
that makes sense.

Joseph Marohn (20:03):
It does make sense and so something I want to
circle back on.
So you said anything that's$500 or below that the buyer's
responsible.
Anything above that you'reresponsible for correct.

Tim Yu (20:15):
Correct.
So I think that's more personalpreference, and also in
Kentucky as well.
So I would definitely recommendtalking to a real estate
attorney or closing attorney inyour area, because in Kentucky
if you're having the tenant payfor like a roof repair, like you
know, change out the whole roof, they may or may not have

(20:36):
equitable interest in theproperty and then if they sued
me down the road like a legalityissue, I would probably have to
foreclose the person versusjust evicting them.
Wow, right, so you have to bevery careful with like the laws.
So I would make sure you knoweverything lines up in that way
and then you adjust your leaseoption like paperwork

(20:57):
accordingly to to to meet thosethose compliance rules and stuff
.

Joseph Marohn (21:02):
Yeah, I'm glad you touched on that, because
every city, every state's goingto be different.
So if you guys are doing leaseoptions, make sure you look up
your specific city or state andlook up those County laws to
make sure that you're beingcovered yourself.
Great, great point that youbrought that up.
And you know, what I also likeabout lease options is, like you
just mentioned earlier, is likeif I rent out to a normal

(21:22):
tenant right, a regularlong-term rental, now they're
going to be hitting me up forevery single repair, right, and
I got to pay all these repairs.
And it could be big repairs,you know.
It could be HVAC, you knowroofing, but a lot of times they
could be bugging you at one inthe morning.
If you don't have a propertymanager blowing you up for a
toilet repair, yeah, and theydon't, and not saying all

(21:43):
tenants, but necessarily theydon't really care, right,
because they're just renting.
They're the renter, that's nottheir property.
But with a lease option, youknow they actually plan on
buying the property at the endof the term.
So they're going to treat itlike their own home, which tell
you and I think we kind oftalked about this before where
there was a tenant that I movedin in March.

Tim Yu (22:10):
So, oh, this month Actually it's March it was my
wife's old house.
We got married so she moved outand then she heard me about
doing all this real estate stuff.
And she's like you know, Idon't want to be a landlord, why
don't you lease option it forme?
And she's like you know, Idon't want to be a landlord, why
don't you lease option it forme?
So, and the tenant, when I toldthe tenant that we were going

(22:31):
to take her and let her move in,she literally cried and said it
was always my dream to buy ahouse and I was just never in
the predicament to do it Right,or no one ever gave me a chance.
So that stuff.
If you're a sentimental person,I am like that's why, like hey
that you know we get put inthese predicaments of real

(22:51):
estate investing and all thisstuff to affect change, and I'm
literally seeing it like rightin front of my face.
So, absolutely awesome, man,this is like what I, this is
like why we're here, right, thisis why we do real estate.
So it's awesome.

Joseph Marohn (23:04):
That's what I love about this business, what I
love about creative finance,because a lot of people, a lot
of sellers, are in badsituations and we get to come in
and be the hero, right, youknow.
We get to come in and beproblem solvers and find
solutions for these sellers thatyou know the traditional route
didn't work for them, right, andwe can come in and find these

(23:30):
solutions from and see thathappy face at the end of the day
.
Yep, dude, it's crazy man.
You just gave me chills rightnow, bro.
I love it.
I'm glad you brought that up,man.
Yes, sir, so sounds like thisstrategy has its pros and its
cons, for both the seller andthe buyer.
I'd like to break that down andtalk more about you know some
of that here.
So let's start with the sellerfirst.
Why would a seller consideroffering their property under a
lease option instead of justselling it outright?

(23:51):
How can a lease option benefitthem?

Tim Yu (23:54):
What if I buy a house in a C-class neighborhood that
doesn't really have appreciation, like historically right?
So there's not a lot ofappreciation, it's a cashflow
heavy market and my family and Imy wife and I don't want to
keep this property longer thanfive years.
Perfect time for lease option.
We buy it creative.

(24:16):
So lease options don't work,always work.
I like lease options because weget creative deals on the
contract and then the tenantbuyer can actually fund the
entry fee.
So that's why I like it on thebuy side.
So as an investor, let's sayI'm buying your house, joseph,
you ask for $10,000 down sellerfinance.

(24:36):
I go get a lease option buyerthat's going to give me $12,000
down.
I just made $2,000 up front tobuy the house.
Right, right, now we're cashflowing.
I'm not a property manager.
It's not a historically cat orappreciative market.
So let's go add 10%appreciation on the backend and

(24:58):
get that person a home.
So everyone's happy, right, Iget a cash flowing asset.
The tenant buyer buys a housethree years from now.

Joseph Marohn (25:07):
So that's kind of like my I guess my take on it
from the buyer side so for the,the seller side, I guess another
benefit would be you get tosell at a higher purchase price,
right, because you're factoringin that appreciation.
So that's, that's anotherbenefit for the, for the seller
right.
Then you're getting your main,you're getting your property
maintained, because now youdon't got to worry about some

(25:30):
guy just messing up yourproperty because they want to be
in it.
You know they looking at it asa, as a property they want to
purchase down the road, right,they're not going to be trashing
your property.

Tim Yu (25:39):
Absolutely.
Oh, and you keep the taxdepreciation because you're the
homeowner.

Joseph Marohn (25:44):
Okay.
Yeah, that's a good point too,because you still own the
property right.
Because right now, in thebeginning phase, it's just the
lease, right, so they don't ownthe property.
You still own the property, soyou get all the tax write-offs
as well.

Tim Yu (25:56):
Exactly so.
That's why I prefer a leaseoption versus a wrap, and I'm
sure you know we're in sub two,so everyone loves wraps, right,
Right.
That's one of the positives ofa lease option is you keep the
deed.
You're still the homeowner.

Joseph Marohn (26:14):
Okay, so I know you brought up like the lease
option fee in the beginning, solet's talk a little bit more
about that lease option fee.
So what percentage should abuyer expect to pay, and is that
lease option fee refundable atall?

Tim Yu (26:29):
No, so the fee is non-refundable, right?
So if they violate an option orif they violate the lease, like
they don't pay rent or whateverthey're violating the option
contract, right?
So the way you structure theoption contract is you protect
yourself with the lease.
So it's like if you violate thelease in any way, you're

(26:49):
violating the option contract.
If you violate the optioncontract, your fee is
non-refundable.
If you don't exercise on theoption contract two years, three
years from now, it'snon-refundable.
If you perform on the option,that money is going to go
towards your purchase price.

Joseph Marohn (27:07):
Awesome, and so how are you determining that
percentage?
Like, is there like a rangethat you're shooting for?

Tim Yu (27:12):
Is it like for me it's we try to be as realistic as
possible, right Like it dependson the deal that I'm buying,
because I try not to go out ofpocket when I'm buying a deal.
So if a seller is telling methat I need $20,000 down, that's
what I'm going to shoot for, atleast because I want to

(27:33):
actually break even.
We don't want to go over 10%,15%, because, remember, these
people most likely on averageI'm not saying everybody is in a
predicament where they don'thave a lot of money.
Or I would just tell them hey,why don't you pay off your high
debt credit cards If you got 30grand in your bank?
Right Like?

(27:53):
You want them to have money tobe able to pay rent and also to
fix their credit.
So I don't want to like gougethem with a $40,000 down payment
.
You know what I mean.

Joseph Marohn (28:03):
Yes, cause, um, I've seen, you know, I've
watched other episodes, likewhere pace was talking about.
You know he charges like a$7,500, you know price range or
you know fee whatever, and Ijust figured there's gotta be
some type of you know percentage, like is it like 3%, 10%?
But yeah, you make, you'remaking a lot of sense, like
you're not going to make it 15%,20%, because then it's not

(28:25):
going to make sense for them atthat point.

Tim Yu (28:27):
Correct On average.
I would like if I could get anentry fee super low, 3.5% down.
The reason why I picked 3.5%down it's equivalent to an FHA
loan.
That's like the lowest loanproduct you can do if you're not
a veteran.
3.5% down it's serious enoughmoney for the tenant to like not

(28:50):
destroy your house and they'lleventually qualify for a loan
down the road.

Joseph Marohn (28:54):
Right, and so if the buyer happens to back out
and doesn't exercise theiroption at the end of the terms,
you as a seller, you're going tokeep that option fee and then
you have the ability at thatpoint to turn around and do it
all over again.
Essentially Correct.

Tim Yu (29:09):
Yep, we clean out the property, we repaint and then we
just re-advertise for anotherlease option.
Buyer.

Joseph Marohn (29:15):
Okay, now does the buyer have the right to
exercise their option before theend of those terms?
Like I know, you said, you dothree years.
Let's say in one year.
Do they have the option toexercise that then?

Tim Yu (29:26):
Absolutely the sooner the better, because if we tacked
10% appreciation and they wantto go buy the house next year,
great Right, Like I'm happy,you're happy, you know you pay
less in rent and you buy thehouse, the sooner the better for
me personally.
Now, when I first started, Iwas hoping that they would take

(29:47):
all the way because I didn'thave as many properties and I
wanted the cashflow for as longas possible.
But if they end up performingon the deal, I think that's
great.
I want them to buy the house.
But, yes, there's nothing in myclauses, personally, that they
can or they cannot perform early, like they're allowed to.

Joseph Marohn (30:08):
Okay.
So what I'm gathering here isthe benefit for the seller is
that you know they could sellthe property for a higher
purchase price in a traditionalsale, since you're factoring in
appreciation for the nextseveral years.
You're increasing demand byattracting a wider pool of
potential buyers, since somesome may not qualify for
traditional financing due tocredit issues or whatnot.

(30:29):
Also, you're receiving anupfront, non-refundable option
fee, which is great.
And then, I guess, lastly, theproperty will be maintained
better because instead ofsomeone renting the property,
they're actually planning onpurchasing the property.
So those are some greatbenefits for the seller.
What about any disadvantagesfor the seller?

(30:51):
Is there any disadvantages youcould think of?

Tim Yu (30:54):
I don't know, I'm kind of biased.
I'm kind of biased with thelease option, but I think that a
con would be still, you'restill a landlord at the end of
it, like we.
We think that, like I mean, itdoes have its perks right.
It has its perks of, you know,minimizing the amount of

(31:15):
property management, but we'restill property management, we're
still renting out the propertyand, at the end of day, if you
wanted to sell it traditionally,you should have just sold it
right, because that truly is themost clean way to break off and
we can negotiate seller financedeals for the tenant right.
We can sell it that way as well.

(31:36):
But there's a reason why wewant kind of like the low key
punishment is because we wantthe tax appreciation and we want
the rental income right.
So I think that's the big thingthat people forget is we're
still property or still managingthe property of some way, some
form.

Joseph Marohn (31:53):
Yeah, I think one .
One disadvantage I can justthink of off the top of my head
here is that you know you'rekind of locking in that future
purchase price, right, but whathappens if the home prices just
shoot up?
They rocket, rocket up, youknow, and now you're leaving all
that equity on the tablebecause you've already committed
to this purchase price.
So that's one disadvantage Ican think of yeah, that's,

(32:15):
that's the bet you take.

Tim Yu (32:16):
Like, if you did a lease option, what?
Like two years ago, you'd becrying, right, 100k of equity
overnight.
And you're like, oh gosh, likeI have another two years with
this lease option buyer, right,right.
But you know, that's kind ofwhy I like to do the one year
options with the renewals,because, you know, one of my

(32:36):
mentors says always be incontrol.
Right, like what if, likesomething like that happens,
like a hundred K equity, like,yeah, like you know, you gotta
make a business decision.
Right, like, are we going toexercise this with the seller?
Are we going to go actuallysell on the market?
Um, you know.
So I guess, like that one yearrenewal option contract, you

(32:59):
know, obviously you have to bevery upfront with the, with the
tenant buyer, like I just wantto say, like it sounds kind of
messed up to have that one-yearthing, but you just have to be
transparent, because I've beenin a situation where I had a
three-year term and I was kindof trapped, I couldn't get out
of it and the tenant was justdoing not a good job and I

(33:23):
didn't take a big down payment.
I took like a $6,000 downpayment and they knew.
They knew that they could losethe money.
So they're just like yeah,you're trapped with me, bro.

Joseph Marohn (33:35):
No, I think it's good that you actually put that,
because a lot of people I don'thear them doing a one-year
lease option or like a presetagreement, like you're doing.
So you're still doing so you'redoing a year where you can
reevaluate the terms, but thegoal is to do three years, is
what you're saying.
So you're going to have twoagreements in there in place.

Tim Yu (33:53):
Yeah, so we.
So in my option contract itliterally has like, like, like,
in a paragraph that says likehey, yes, this expires in this
date, but you extend it, youknow, up to two times, up to two
more times if you meet thefollowing requirements.
Oh okay, so we break it downbarney style, right?

(34:14):
So, like you know, hey, youkeep doing this, you keep doing
this, you keep doing this.
You can renew for another year,got it okay?

Joseph Marohn (34:21):
you're violating.
If you're violating those, hey,you're violating the option
contract, so now we can cut youokay, so now let's let's talk a
little bit about the benefits ofa lease option for a buyer.
You know what are some of themain benefits for them.
What do they gain by doing alease option?

Tim Yu (34:38):
well, they get the opportunity to one day own a
home, right?
Right, you give them a chanceto live in a place that's not
super slumlordy, right?
I had so many tenants thatmoved into one of my houses.
They're paying a little bitmore rent per month but they're
living in a nice house, they'reliving in something livable and

(35:03):
they have that sense of pride oflike home ownership and the
price is stable, so kind of thesame way that you were talking
about with selling a leaseoption if that house skyrockets
a hundred grand.
They just bought a house ahundred grand cheap, right, they
bought on a hundred thousanddollar discount because they

(35:24):
locked in it with me two yearsago.
You know so.
And if you're a good like tenant, like lease option landlord,
you're gonna get resources fromme.
You're gonna get great lendingofficers.
You're gonna get a personthat's actually going to hand
walk you and build your credit.
Um, the rent that I that theypay me, I actually report to the

(35:48):
credit bureau, so I, so I paythe extra two dollars a month
and I report their rentalpayments.
So I'm really trying to likeget these dudes to like qualify.
You know I'm saying like, wewant them to buy that house, so
there's so many things that youcan do for them to make their
experience like a one-stop shop.

Joseph Marohn (36:14):
Yeah, and I think another great thing is that you
know you really get time tobuild roots in your community,
right?
Because when you go in you know, let's say, you go rent an
apartment building or you rent ahouse in an area and you only
have a one-year lease to yourlease.
That can be tough, man, if youhave kids, right?
Because then if they don'trenew the lease, or, let's say,
the landlord happens to raisethe rent on you and you can't
afford it, well, you're forcedto move.
And now you've got to changeyour kid's school, change their

(36:38):
activities, their sportsactivities, and have to relocate
.
You can't really build roots inyour community.
So I think that's also a greatoption for the buyer your
community.

Tim Yu (36:49):
So I think that's also a great, great option for the
buyer.
Yep Super smart right.
They get to be stable for theamount of years that they're
staying with you.

Joseph Marohn (36:56):
You know what I mean.
So it's great, it's cool thatyou actually go out of your way
to help them improve theircredit, right, because, let's
say, they can't get approved fora traditional loan right.
Then now you're giving themthat option.
So like, hey, you got threeyears to live in this property,
let's get your credit straightso when, by the time you go to
qualify for this loan, you canactually get approved for it

(37:17):
Exactly, exactly.

Tim Yu (37:19):
And after they buy the house, their credit score is
improved, right.
So, like financial, likeoverall health has improved, and
now you're a homeowner Right.
So there's so many differentperks for the buyer, especially
if you're a, you know, if you'rean investor that really cares
about people and actually wantthem to succeed.

Joseph Marohn (37:41):
Right.
And then not only that man,they get to test drive the
property.
Right, Because now they get tostay in this property, let's say
like year two, three years downthe line.
They're like you know what Idon't really like this house.
Man Thing makes noises at night, man, I don't know, there's
some voodoo stuff going on here,you know.
But and now they can kind ofmove out, or let's say that they
don't like the area, Maybe theydon't like their neighbors.

(38:01):
They have the right to notexercise that option, right,
Because they're not forced toexercise that it's your choice.
So, in other words, it binds theseller to sale, but it doesn't
bind the buyer to buy.

Tim Yu (38:15):
As long as that tenant is willing to lose their deposit
, it's their choice.
They can walk and we've seenthat happen too where they're
like, hey, it's just not reallyin the books for us for our life
anymore.
We want to move somewhere elseand no harm, no foul.

Joseph Marohn (38:32):
I mean Tim.
Correct me if I'm wrong here,but it almost sounds like a
lease option is more beneficialfor the buyer than it is for the
seller.

Tim Yu (38:40):
Honestly.
Dude like if it's done rightand you know the the, the
owner's not charging super highrent.
Dude like there's so manypositives for the buyer man,
right, but the problem isthere's just not many available
right, because of maybe it'slack of education or, you know,
lack of knowledge of a leaseoption.

(39:00):
But it's just like you know,because everyone thinks of a, if
I'm going to rent or if I'mgoing to do a rent to own, it's
going to be a contract for deed,right, and it's like no, no, no
.
I think contract for deed isactually more dangerous for
everybody than a lease option.
But we can argue about that allday.

(39:20):
But I think it's a little saferto rent the property and then
qualify to just buy me outentirely, versus that trickle
down effect.
You know where you're, whereyou're owning more and more of
the property.
It's just kind of weird.

Joseph Marohn (39:34):
Absolutely, I mean.
So what are some of thedisadvantages for the buyer?

Tim Yu (39:40):
Well, they're paying rent and it's not towards any
principal, that's the biggestthing, Like it's.
They put a down payment down.
So you know, their piggy bankmoney is all locked in this deal
and then they're not paying.
So, you know, versus a contractfor deed, they're paying down
equity.
They're not paying anythingdown, it's just rent.
So they have to budget as arental.

(40:02):
They got to pay rent and thenthey also have to, you know, pay
their bills and keep buildingtheir credit.
You know what I mean.

Joseph Marohn (40:12):
So I think that's the biggest problem is they're
just renting.
Yeah, that's a good pointbecause, like you said, you're
locking in this future purchaseprice, but as they're paying
that payment for the next threeto five years, it's not going
towards the principal, it's onlygoing towards the lease
agreement that you structured.
It's only going towards thelease agreement that you
structured.
So at the end of those terms,they still have to start over
and start paying down thatproperty that they originally

(40:33):
signed the deal for.
Absolutely Okay.
So talk to us about applyingcreative finance strategies with
the lease option.

Tim Yu (40:44):
How are you doing that?
So that's a good question.
I like to buy creative, so Ilike to buy wraps or hybrids.
So seller finance subject to,and then my exit strategy is
sell on a lease option.
The reason why I like to preferto buy creative, sell on lease
option is because what we talkedabout earlier I like to be in

(41:06):
control of the deed.
So always be in control, alwaysbe in the driver's seat when
you sell on a wrap.
So if I buy a wrap and sell awrap, I technically give the
deed to the buyer and if theydon't pay me, I have to
foreclose them because they havethe actual paperwork In a lease
option if done correctly Godforbid, they don't pay we evict

(41:30):
the person.
And in Kentucky option, if donecorrectly, god forbid, they
don't pay, we evict the person.
And in Kentucky it's a lotfaster and a lot cheaper to
evict than foreclose.
So that's my big thing.
And then the second way is youcan do a lease option to a lease
option, the lease optionsandwich.
So I'm sure a lot of youcreative finance guys out there
have talked to sellers thatdon't actually want to sell

(41:53):
their property or they feeluncomfortable giving their deed
up, right.
So they're like oh, I don'twant to sell the property.
Okay, well, what if I give youa down payment and pay you rent,
so your entire landlord but I'mgoing to give you passive
income every single month.
He or she agrees to that.
Get on their contract and thenyou lease option it back out to

(42:14):
another tenant buyer.

Joseph Marohn (42:17):
Dude, that's sweet man.
That's what I love aboutcreative finance man.
You could just really get socreative.
You're only limited to whatyour imagination is.
And you said that's called asandwich lease option.

Tim Yu (42:28):
Yep.
So imagine lease option frombuyer to me and then me to the
tenant buyer that's renting thehouse.

Joseph Marohn (42:36):
So you're structuring the terms with the
seller and then you'rerestructuring your own terms to
your future potential buyer.

Tim Yu (42:43):
Yeah.
So like, let's say, averagerents in the neighborhood is 800
and the seller wants 5,000 down, $500 a month.
Great, I'm going to give him5,000.
And then let's say we find atenant buyer that gives us 8,000
down and wants to pay us $800 amonth.
We just made $3,000 in theexchange and then now we're cash
flowing 300 bucks a monthpassive right.

(43:06):
So no money, no moneytechnically, no money out of our
pocket and we're making three$400 a month cashflow.

Joseph Marohn (43:14):
That's awesome, man.
So all right.
So, tim, so if you're the buyer, like you're purchasing the
property you know subject to, orseller finance, and then you
turn around and you sell it on alease option, is that buyer
paying you and then you'repaying the mortgage and
pocketing whatever's extra, oris the seller I mean the buyer
paying directly to the lender?
How does that, how does thatprocess work?

Tim Yu (43:37):
so it would kind of be like a traditional well, you can
use it like a servicing company.
Um, especially if you're doinglike a sub two seller finance
deal and you got to pay thesellers like mortgage and stuff,
I would would use a servicingcompany.
But I guess, like the basiclogistics of it is so your
tenant, like a normal rent, likea normal renter, would pay you

(43:58):
your monthly rent.
You have that money and thennow you have to go pay your
mortgage, right, so it flowsthat way, so from tenant to you
and then you to whoever you haveto pay to get the deal done.
So if you got a 30-yearmortgage at a bank, you got to
pay that mortgage, right, yougot to pay that seller finance
note, you got to pay that sellersomehow.

(44:19):
So we like to use the rentalincome from the tenant to pay
whoever we have to pay, justlike a traditional rental Senate
to pay, whoever we have to pay,just like a traditional rental
Got it Makes sense.

Joseph Marohn (44:29):
Okay, and you said the main reason, because a
lot of people do argue thatright, they're like hey Tim, why
don't you just do a wrapinstead of doing a lease option?
So your main purpose for notdoing a wrap is because you
actually hold the title on thelease option, correct?

Tim Yu (44:43):
Correct and also I think it's more complicated to tell
people what a wrap is Right.
So if I say rent to own,majority of people know what
that means they're going to rentuntil they own the house.
When I say like I talk toagents all day right, it's like
hey, want to sell my house on awrap.

(45:03):
And then you're like, they'relike what is that Right?
You're like well, it's when youwrap a new mortgage around a
previous mortgage and it's likeit's effective.
But I think it's a little moredifficult to sell and to get rid
of.

Joseph Marohn (45:19):
Yeah, I think you got to do a little bit more
teaching than just saying youknow, lease to own it's a lot
more simple, a lot of peoplehave heard of it more than a
wraparound mortgage.
Absolutely okay, so can youwholesale a lease option to put
in buyer?

Tim Yu (45:35):
that I don't know actually, um, that would be
really interesting if you could.
If you can, I mean, I guess,like, I guess in that way though
I would probably just try toconvince them to do a seller
finance deal if I was going towholesale, because, like that,
like that's crazy, right, likeyeah, that'd be nuts, that'd be
nuts.

(45:55):
If anyone can like kind of shedsome light on that, that'd be
pretty awesome.

Joseph Marohn (46:01):
Yeah, because I'm thinking about it right of
finance.
You know structuring a leaseoption agreement with the seller
and then just turn around andwholesale, my wholesale, and
often click an assignment feelike.
You structured the terms Rightand now you're collecting that
assignment fee.
So yeah, man, if anybody knowsany, you know about that, or if
you can do it, drop a commentdown below.

(46:23):
I want to.
I want to know more about yourexperience with that, because it
also leads me to anotherquestion.
Can you flip a lease option, doa fix and flip and do a lease
option?

Tim Yu (46:32):
Yeah, you technically can, right, Because at the end
of the day the landlord, theoriginal seller, just wants to
get cashed out, right.
But I think you have to havethat conversation with the
seller like hey, is there gonnalike kind of the same question.
You asked me like do you have aprepayment or pre-execution
penalty if the seller is like noman, if you want to like

(46:55):
refinance and pay me off, I'mgood with that.
Then we can put that in thepaperwork and kind of get it
done.
But I think that kind of getsmessy right, because I think
that kind of starts to like gointo like potential innovation,
agreements, potential, you know.
I mean now we're like I thinkwe're over complicating the
sauce, if that makes sense,because so many moving pieces.

(47:16):
But I think that you know, ifyou have a conversation with a
seller and you get it down onpaper, I don't see a problem
with it yeah, and so anothercool thing that you're talking
you're kind of talking about um,a third party servicing company
.

Joseph Marohn (47:31):
Right, I saw this uh podcast interview with pace
and Jerry Norton I don't know ifyou saw it.
It's part of his masterclass Um, and he was talking about if
you service the least optionwith the third party servicing
company and when the renter goesto get qualified for a new
mortgage, it's not considered anew mortgage.
Instead, it's a refinanced,because you're showing the

(47:53):
lender that they were making thepayments to a third party
servicer.
Yes, yes, have you applied thatat all, or is that something
you're familiar with?

Tim Yu (48:00):
No, I have not, just because I have the local people
in my, in my market.
But if you don't have thatresource and you're like doing
it virtually and all that stuff,yes, absolutely leverage the
third party servicing companies,because that actually gives you
an advantage in that way.
Um, I do everything in mybackyard, so like literally I

(48:21):
can call like three loanofficers that normally do
business with me, so like I havethat kind of connection locally
.
But I would definitely leveragea servicing company that does
all that stuff for you, cause itonly helps you.

Joseph Marohn (48:36):
Yeah, cause that's interesting to me, cause
you know, now they don't have toactually go apply for a new
mortgage because they canalready prove like hey, I've
been paying Tim for the lastfive years, so now it's not
really a technically a newmortgage loan, it's actually
just a refinance.
So interesting stuff there.

Tim Yu (48:52):
To my name yeah, new rate.
And to my name Right.

Joseph Marohn (48:57):
So what kind of what common mistakes do you see
beginners make with leaseoptions, and how can they avoid
them Picking the?

Tim Yu (49:03):
wrong tenants and not getting enough money down.
Like don't let somebody leasean option with like a hundred,
like with a thousand dollars,right, it's something that you
need to have enough of a downpayment for them to think twice
if they're going to do somethingbad, like, oh, if I don't pay

(49:26):
rent, like I don't care if theyevict me, right, I'm only going
to do something bad.
Like, oh, if I don't pay rent,like I don't care if they evict
me, right, I'm only gonna lose athousand dollars.
But they're losing eighteenthousand dollars or ten thousand
dollars, like that's asignificant amount of money yeah
, absolutely.

Joseph Marohn (49:40):
I mean that's.
That's a very good point, man,you know, make sure that you
know you're not bringing insomeone that's just paying too
little bit of money, right,because then you're at a higher
risk.
You're not bringing in someonethat's just paying too little
bit of money, because thenyou're at a higher risk, tim do
you mind sharing a story of oneof your lease option deals that
was a successful turnout.

Tim Yu (50:00):
Yeah, I've only been in the game for 15 months, so I
actually don't have anyonethat's actually performed
recently, because a lot of themare recently put in there in the
last year or so.
But I can tell you a story of alady we just moved in a couple
weeks ago.
So she we usually like to have10 down.
Um, she didn't have that right.
She had a bad credit score andand I said, hey, listen, we just

(50:25):
want, like we can worksomething out.
Let's do three and a halfpercent down on move-in day and
then I'll sell her finance orlet you pay that non-refundable
payment over a course of two,three years.
So, yes, I'm taking a risk, butI met her family, I met her and

(50:46):
you know she's an incrediblelady that's just been through a
lot of health issues and kind of.
You know you hear their storyand you understand, like why
they're in that predicament andyou know she's like I had a lot
of medical bills and stuff likethat and you know I kind of fell
behind and I said if you have3.5% down, we'll move you in.

(51:07):
So she did so 3.5% down movesher in, and then we structured a
payment plan for her to get theremainder balance of that
non-refundable down payment.
Now, guys, be sure to rememberthis Do not mix your checks with
each other.
Do not have your rent check inthe same check as your

(51:30):
non-refundable money.
Everything must be keptseparate.
I've seen this before in myactual city.
This person was takingnon-refundable payments within
the rent and it was combined andthen when they had a bad issue
she was trying to evict theperson.
The judge actually said thisperson has equitable interest in
the property You're going tohave to X, q, o, f or C.

(51:54):
Wow, keep everything separate.
It's good practice for yourbooks, it's good practice for
everything.
Rent is rent.
Non-refundable isnon-refundable.

Joseph Marohn (52:06):
Yeah, that's a very good point you brought up,
because I did see a lot ofpeople word it and they say a
down payment, when it's notactually a down payment.
It's a lease option fee whichis non-refundable.
So you got to make sure thatyour verbiage and your contracts
state that, because if they putin a down payment, technically
it's hey, I put a down paymenton this house, I have an

(52:27):
equitable interest in thisproperty.

Tim Yu (52:30):
Yes, non-refundable option fee Like do not say down
payment.

Joseph Marohn (52:35):
Crazy.
Yeah, that's good stuff.
That's good stuff, man, soawesome.
Well, tim, I think we prettymuch covered all the basics of
how lease options work, for notonly the sellers, but for the
buyers as well.
Is there anything you can thinkof that we might have missed
and didn't cover today, that youthink we should cover?

Tim Yu (52:53):
I think we cover most stuff.
I think there's potential goodleads out there, so maybe we can
talk about that real quick.
I love rental.
If you look on rental marketsand any house has been not
rented for 30 days or longer,those are great potential lease
option sellers Because they'retrying to rent it out the

(53:15):
property to begin with.
They just unfortunately can'trent it out.
So if you kind of pitchsomething like, hey, what if we
sign a?
It's kind of like arbitragingright Right, right, right Right.
What if I what if I, you knowpay you a monthly and then in a
couple of years I buy the price.
I buy your property at a higherpurchase price.
That's how I would sell it.

(53:35):
It's like, if you're interestedin potentially selling, what if
I rent this house from you forthree something years, whatever,
and then I buy it at a higherpurchase price and then you
negotiate it from there.

Joseph Marohn (53:49):
I'm glad you brought that up, man.
So you're looking at propertiesthat have trouble renting out
for the last 30 days is whatyou're saying.
So what sites are you lookingat?
Are you looking on Zillow?
Are you looking?

Tim Yu (53:59):
on Instagram Zillow Facebook Marketplace.
Bro, like you'd be surprisedhow much crazy stuff is on
Facebook Market.
Surprised how much crazy stuffis on Facebook market.
Like those people that are, youknow, like you know, mom and
pop owners, right that just liston Craigslist and stuff.
They're the perfect people totalk to.

Joseph Marohn (54:15):
Dude, that's awesome Cool stuff, man.
Anything else you could thinkof?
I want to make sure we covereverything right, Because I know
there's so much to leaseoptions.
We could probably even do apart two of this, but I just
wanted the main focus of thiswas to cover the basics of it
and then we can get to moredeeper strategies on the next
episode if we decide to go thatroute.

(54:36):
But anything else you can thinkof right now.
That for the basic standpointthat we should have covered.

Tim Yu (54:43):
I think we're good on the basics.
I think that you you know it isa good tool to have in your
tool bag and it gives youflexibility, right like gives
you flexibility and and I guesslike the biggest takeaway is,
you have the potential to givesomeone the opportunity to buy a
house, and it's, it's a greatfeeling to have.

(55:03):
And also, you make some money.
Well, so you're getting paidfor the service you provide.
So I think it's a win-winacross the board.
It's super awesome and if youdo it right, you're protected
legally as well.
Awesome.

Joseph Marohn (55:17):
Well, tim.
It's been an honor to have youon the show, brother.
You brought a ton of value heretoday, not only to my viewers,
but myself as well.
You're absolutely crushing itin this space right now.
I see you on the rise, jumpingon different platforms and
creating a ton of momentum.
People in the real estate spaceare getting to know exactly who

(55:38):
Tim Yu is and the value youbring to the table.
I know you've been talkingabout it lately, but I truly do
hope you start that podcast soon, bro.
I can't wait to see what you dowith your channel, and you can
count me in as a subscriber forsure.

Tim Yu (55:48):
Hey, I love it, brother.
Thank you so much for having me.
Everyone hit the subscribebutton on Big Jose's podcast.
I reached out because his showis awesome, man, so tons of
value, and thank you so much forinviting me on, man.

Joseph Marohn (56:01):
Hey brother, I appreciate that.

Tim Yu (56:04):
Sam, where can people get a hold of you?
Instagram's the best way.
It's so the at sign it's Tim,you so ITS and then my name.
Um easiest way to reach meplease shoot me a DM.
I love to help you guys.
Um, I help a lot of wholesalersrenegotiate contracts, so feel
free to hit me up.

Joseph Marohn (56:20):
There you go Hold , hold Tim to that man, send him
a DM and I'm sure he'll be ableto answer any questions that
you guys might have.
So again, appreciate you, bro.
Now, if you guys are findingvalue from this episode, don't
forget to show me a little love.
Subscribe to the channel andhit that bell icon so you don't
miss any future episodes.
Don't forget to like this anddrop a comment down below what

(56:41):
you learned today about leaseoptions.
Appreciate all the continuedsupport and, guys, stay tuned.
I got a new real estate topicthat I'm dropping every two
weeks.
Best believe I'm a key.
Bring you that fire.
Thank you, tim.

Tim Yu (56:55):
See you guys Appreciate it.
Thanks for watching.