If you are looking to
get cash for your land, there are many different types of deals
that we can consider. What makes sense depends on your specific
needs - whether it's getting cash as fast as possible, or
getting the highest possible price, or having the ability to
get your property back in the future.
Sometimes putting a deal together involves mixing several
elements together. When you fill out our questionnaire to tell
us about your specific property, we consider all the
information you provide in order to put together an offer that
is most likely to suit your needs. This page is here as a
reference to some of the things we might propose. The more
information you have, the easier it is for us to work
together.
Note: not all of these types of deals are available in all
locations. Numerous federal, state, and local laws and
regulations may restrict what kinds of transactions may take
place. This page is for general information
only. You should not assume that any deal we may
propose will correspond neatly to one of these options.
Straight Sale
A straight sale is the simplest type of transaction
to understand. We pay you a lump sum of cash, and you sign a deed
to the property, making us the new owners.
Installment Sale
Suppose you don't need cash right away but would rather get
payments over time. To sellers looking to build a stream of
income, an installment sale might be the best
bet. You sell the property to us and sign a deed. In exchange,
you receive payments for specified period of time at a
specified interest rate. Payments include both principal and
interest, and are allowed to defer some of the capital gains
taxes that might be due if the deal were structured as a
straight sale. The effective yield you earn on an installment
sale is higher than you would earn in a typical bank account,
so this can be a smart choice for a seller without immediate
cash needs. Also, as buyers, we may be willing to pay a higher
price for an installment sale than a cash sale in some
cases.
Selling a Purchase Option
Suppose you have a price in mind that you want to get for
your property, but can't find anyone willing to pay that price.
If you're willing to wait, but want to generate some income in
the meantime, selling a purchase option might be a good
strategy. The price that you require is called a strike price, and the
amount of cash you receive upfront is called the premium.
During the term of the option, the option buyer has the right,
but not the obligation, to buy the property from you at the
strike price, and you may not sell the property to anyone else
until the option expires. If the option buyer decides to buy
the property, you got the price you wanted. If not, you earned
some income in the meantime. Of course, while the option is in
force you still own the property. You can enjoy it, but still
have to pay taxes and any upkeep. The premium you receive
upfront is usually of a similar size to an earnest money
deposit, and the strike price is typically at a higher price than we
would make a cash offer for a straight sale.
Buyback Option
If you decide to sell your property, you may want to protect
yourself against regret. Suppose later on you want the property
back, or it appreciates in value and you regret having sold. Or
whatever circumstances that motivated you to sell change.
For a small fee, you can purchase a buyback option at
the time you sell. This gives you the exclusive right, but not the
obligation, to buyback the property at a specified strike price for a
specified term. The strike price is typically equal to the
sale price plus a modest markup for closing costs and the carrying costs
of the property (interest, taxes, etc.). |