Saturday, May 27th, 2017

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Steal This Model: 8 Steps to Wholesaling Lease Options

Recently I had the opportunity to connect with St. Louis real estate investor Joe McCall, who’s been an acquaintance of mine for a few years now, and a long-time understudy of my buddies Steve Cook and Shaun McCloskey.  But to be honest, I’ve never really known what Joe’s particular REI niche was until now.

So check this out…

It seems Joe has developed his own special little niche: wholesaling lease options.

And as a result, Joe found himself in a position so many new investors dream of:  His part-time income from wholesaling lease options surpassed his full-time J.O.B. income very quickly.  His $75,000 / year job was actually starting to cost him money. So as you might imagine, he kissed his “real” full-time J.O.B. goodbye within a matter of months and hasn’t looked back since.  All thanks for his quiet little discovery of wholesaling lease options.

So when I reconnected with Joe, I was – as you might imagine – intrigued.  And I thought you might be too.  So here’s a guest post by Joe, describing briefly how it came about, and how it works for him.  Enjoy…

What is “Wholesaling Lease Options”??

By Joe McCall

Let me first tell you a little bit about my background.  A few years ago, I was buying a lot of homes with traditional bank financing.  When the banks started telling me that I couldn’t buy anymore homes, I started buying homes “subject-to” the existing mortgage.  Pretty soon, I owned about 12 homes within 12 months.  (And I was selling all these homes on Lease Options.)

Yes, I owned 12 homes.  I thought I was a successful real estate investor!  But…

I was equity rich and cash poor…can you relate??

I had lots of equity?  OK, actually I thought I had lots of equity… but then the market crashed!  Can anyone relate?

But when you are only making $100 – $200 per month cash flow on each house, that money quickly disappears in vacancies and repairs.  All of the sudden, I found myself with a serious cash flow problem.  I realized I needed to fix my cash flow problem, and fix it quick.  So I started wholesaling houses.

So next I found myself spending thousands and thousands of dollars on marketing – direct mail, Google adwords, websites, signs, etc.  And I was getting a lot of leads, and actually starting to make some good money!

But before too long I started getting very frustrated because I was spending so much money on marketing and throwing away so many leads from sellers who were not motivated! Maybe they didn’t have enough equity.  Or maybe they did have enough equity, but they weren’t willing to share any of it with me!  A lot of my leads weren’t behind on payments. As a textbook wholesaler there was nothing I could do to help them, and I was getting really frustrated!

So there I was. I loved buying properties and I was really good at selling them on lease options.  But that approach left me with a serious cash flow problem.  And while I loved the cash flow that traditional wholesaling was giving me, I was frustrated with the amount of time and money I was putting in marketing for wholesale deals with relatively little to show for it.

That’s when it hit me:Why not wholesale lease options”?!

Let’s look at some facts…

1) There are TONS of sellers out there who can’t sell their home.  They either have very little equity or they aren’t willing to discount their home to 70% of ARV to compete with the banks.

2) There are TONS of buyers out there who can’t buy a house.

So I thought to myself, why not stop throwing away all those leads and do something with them?  Why can’t I put “Lease Options” and “Wholesaling” together and make the same money with them as I was making with regular wholesaling?!

The Quick and Dirty of Wholesaling Lease Options…

Here are the basic steps:

1) Find a motivated seller who wants to sell their house on a Lease Option…

2) Get the property under an “Option To Lease Option” contract…

3) Find a qualified tenant-buyer who has a good down payment and a good chance to get a mortgage in 6-12 months…

4) Sign the Lease Option paperwork with the Tenant-Buyer…

5) Assign the Lease Option docs back to the seller…

6) Keep the Option Consideration / Deposit and give the Seller the first month’s rent…

7) Put the Tenant-Buyer in a credit repair program with your mortgage broker…

8 ) Deposit your money & move on to the deal!

Real simple… really!  That’s why I love this business so much.  Almost anyone can easily do 1-2 of these deals a month.

Imagine what you could do with an extra $3,000 – $10,000 in “Hip Pocket National Bank” every month!  And if I can do it – anyone can!!!

– Joe McCall
St. Louis, MO

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Steal This Model: 8 Steps to Wholesaling Lease Options, 3.3 out of 5 based on 4 ratings


JP Moses is a roughly-hewn man-child who first got into REI after reading Rich Dad, Poor Dad back in Y2K and went full time in 2002. He's tinkered in everything from landlording to short sales to rehabs to Realtoring to REOs to notes to owner financing, blah, blah, blah...Till he finally stuck his flag deep into wholesaling and has since flipped somewhere north of a couple hundred deals.

JP's not a “guru” but also doesn't think it's a bad word. Among his core values are authenticity, creativity, big honkin' value, general fun-ness and being unshaven. He's super proud to be chief blogger guy at and host of the free REIology podcast. He also thoroughly enjoys sharing his 53 best real estate investing forms with anyone who wants them. You should totally check that out. :-)

  • Mark

    How do you a motivated seller that is willing to do a lease option? Ive contacted many sellers and landlords via Craigslist and on-line websites but having trouble finding any sellers that will consider doing a lease option. It’s mentioned that “almost anyone can easily do 1-2 deals a month.” How do you find them and how do you get them to agree to do a lease option?? Thanks.

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  • Home-sales

    So when you have the Tenant-Buyer sign the Lease Option agreement, do you sign as the owner or put the Seller’s name there?

  • Home-sales

    Once you have found a Tenant Buyer and we sign the Leae Option Agreement, does the Optionee sign the Lease Option Agreement with the Tenant Buyer or is that left for the owner to sign? Thanks Elle.

  • I need one thing cleared up. Which Lease option contract do you assign back to the Seller? Is it the tenant buyers lease option

  • Hi, Brian. Basically you sign the Lease Option paperwork with the Tenant-Buyer, then assign those Lease Option docs back to the seller. Make sense?

  • Basically you get an option to lease agreement between you and the seller.  Then you find a tenant-buyer and sign new Lease Option paperwork with the Tenant-Buyer, and then assign those Lease Option docs back to the seller. Make sense?

  • I’d say you sign as the “Optionor” then when you assign those docs to the property owner, he becomes the “Optionor”.  You can be the “Optionor” initially due to the option to lease agreement you signed with the owner.

  • …Or to someone who’s creditworthiness can be rehabilitated fairly quickly. 🙂

  • Joe offers one on his site.  Just follow the link over to him in the article above.

  • Yeah, basically you are assigning your position you have with the tenant buyer in all the contracts over to the seller (the seller takes over your position in all the contracts).

    Some people prefer to go the other way & assign your position you have with the seller in all the contracts over to the tenant buyer.

    Jay von Mohr

  • Yvonne

    Hi I have been doing Lease Options in Central Ky. I would love to talk to you about strategy! Its hard to find others in KY that are actively investing in this manner. Hope you contact me!


  • Vivian

    I would love to Yvonne.The question is “how” without posting all of our personal info. 🙂

  • Yvonne

    Contact me at my email at  Look forward to hearing from you!

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  • I think if you hire real estate agent then you sell you poor house within few days because these guy have unlimited contact for selling your house if i don’t about real estate market then we should avoid from this business and choose right person.

  • Pingback: Lease Options and stuff |

  • Romao

    This is all Great My Question is how do you get the leads the people that want to sell there Home on a Lease Option . What advertisement would you use my problem is what should i say to them to get them to want to do the Lease Option.

  • Hi, Romao. One easy way Joe finds them is by calling houses for sale and for rent in

    He literally just says to the houses for sale something like, “Would you be open to renting it out if you can’t sell it for some reason, with an option to buy it a little later?” And for the “for rent” ones he says, “Instead of just renting, would you be open to rent-to-own, and maybe selling it in a few years?”

    Easy as that!

  • Steve

    Great stuff. You bring credit to the field. In this “up” market, lease options seem to be few.
    Steve Brown

  • Stephen Atkinson

    do you need to do title search to make sure there is no second mortgage or other leins on the property so your tenant-buyer doesn’t end up getting screwed when they go to exercise the option?

  • @disqus_hRFP6lN2ok:disqus – Sure, that’s always an option. But I’m pretty sure Joe doesn’t do that on all his wholesale lease option deals… after all, even if the title’s clear today, there’s no guarantee it will be exactly the same situation in a couple of years when the tenant-buyer is ready to go on executing their option to purchase anyways. A title search today only guarantees what the title looks like today… not 2 years from now. So it would have limited value. Personally I’d go instead for some type of guarantee in writing from the seller that they have clear title, and no liens other than what’s clearly stated. That’s my take.

  • ksoza

    I would guarantee tenants from the gate or with in a month of take over nomatter what people want to see there money ASAP so having the ability to say i can make a call and have 1-? potential tenants there to look at it with in the week have them moved in on contract I would think would be an advantage…but IDK …im knew to this dont have much money and need to figure out how to get the cash to start my self ?