Ten Reasons to Use an Option Contract (5)

In other words, with the option you control the property without owning it. Let’s add some numbers to this controlling property with options scenario. How much property could you control using $2.4 million as option fees? Let’s say the option fee percentage is 10 percent. Some of you can do the math in your head. This amount, $2.4 million, is 10 percent of what number? That’s right—$2.4 million is 10 percent of $24 million. No wonder Donald Trump likes to use real estate options.

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Ten Reasons to Use an Option Contract (2)

Ten Reasons to Use an Option Contract (2)

This can make your remaining property purchases very expensive. It can be a disadvantage because you tip off other real estate investors who could be your competitors that you are buying property in a particular area. Do you think that Donald Trump targets an area to make a real estate investment in and then makes a public announcement or tips his hand to let his competition into the bidding? Of course not. Use an option contract to maintain your privacy.

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