Most Investors Dont Have the Cash Reserves to Subsidize Sublease Options

The fact of the matter is that most real estate investors are woefully undercapitalized and do not have the deep pockets or cash reserves that are usually needed to subsidize sublease-option deals. Few serial sublease-option investors are around because most people go broke supporting their first sublease-option deal! This lack of operating capital creates a domino effect whenever there is any type of financial emergency. For example, when a tenant-buyer fails to pay the monthly sublease payment, the lessee usually has no money to make the lease payment to the property owner, which forces the owner to initiate eviction proceedings against the lessee for nonpayment of rent. This in turn forces the lessee to start the eviction process against the tenant-buyer for failing to pay the rent. And if the lessee cannot come up with the money to pay the lease payment, the lessee will end up losing the real estate option, and the only thing he or she will have to show for their time, effort, and money will be an eviction on his or her record.

Was this article helpful?

0 0
Optimum Options

Optimum Options

Get All The Support And Guidance You Need To Be A Success At Options Trading. This Book Is One Of The Most Valuable Resources In The World When It Comes To How To Come Out A Winner In Options Trading.

Get My Free Ebook

Post a comment