Mortgage Killer Accelerator

Strategy 20 of 107

Sale-leaseback: sell the home to an investor and rent it back

Depends on people or program rulesFrom an asset you already own

What it is

An investor buys the home, the mortgage is paid off at closing, and the former owner signs a lease to stay.

Steps

  1. An investor buys the home, the mortgage is paid off at closing, and the former owner signs a lease to stay.
  2. It ends the mortgage by ending ownership. Rent replaces the mortgage payment.
  3. Read every term: the price, the fees, the rent increases, and whether there is a real right to buy back.

Repeat: Once.

Measure: Cash received after fees against the home's appraised value, and the rent over the lease.

This one does not fit the calculator.

Risks

  • The FTC warns of hefty fees, high rent and even eviction.
  • Future appreciation belongs to the investor.

Who it fits

Grandmas and grandpas (62 and over), Higher net worth, with assets

Needs

Any homeowner with a mortgage.

How predictable

Depends on people or program rules (tenants, family, IRS records, lenders)

A worked example (hypothetical, not guaranteed)

Picture a hypothetical household (grandmas and grandpas (62 and over)). They owe $300,000 at 6.5% with 30 years left. The required payment is $1,896 a month, and that payment, which comes from income, never changes in this example.

They follow the steps: an investor buys the home, the mortgage is paid off at closing, and the former owner signs a lease to stay.

This strategy changes who owns the home rather than the loan, so it has no payoff date to compute. Read the risks closely before going further.

Sources and more information

Where to get help

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