In this Q&A Thursday episode, Chris Prefontaine and his son Nick discuss why accepting rent‑to‑own or lease‑option buyers who put down less than roughly 3% creates significant headaches for investors. They explain that such buyers behave like "glorified tenants"—they are quick to stop payments when personal or property issues arise, making the down payment effectively non‑refundable. The conversation then shifts to the systematic screening process Nick has built over more than a decade, which uses a customized, white‑labeled CRM to automatically weed out tenant‑type prospects and surface serious buyer candidates. They also note that ad copy (bold, italic, “rental only”) does little to filter leads because most prospects skim listings; instead, the real qualification happens during the call and through the automated workflow. The video ends with promotional calls‑to‑action for their smartrealestatecoach.com and 3paydaysapprentice.com resources and a reminder to subscribe for regular deal‑structure and motivational content.
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So you're asking for a huge headache if you accept a rent-to-own buyer for less than 3% down. Hey guys, it's Chris Prefontaine and my son Nick Prefontaine with another Q&A Thursday. Nick, I know this topic like can get you rolling. So we get this all the time from, from, from the students, from the community. But more importantly, you just mentioned off air that This is when headaches happen, when students either knowingly or accidentally accept a buyer with 3% down. Right. So why is that the case? Give them some insight.
Sure. This, this really doesn't come just from my experience with working with associates that I see, like, objectively, and it only happening to people objectively as we coach them. I know this intimately because I've lived it. I know in the past when we've been hurting for finding a buyer and we haven't been able to find a buyer, had to make a few payments out of pocket for a particular property that we're always just looking to stop the bleeding. But I think each and every time we look to stop the bleeding and just get someone in there to start making the monthly payment, if we accept less than 3% down initially for their initial down payment, It always ends up biting us in the butt for various reasons because they're really— they're nothing more than a glorified tenant at that point. And the moment something happens with the property, either with the property or their life, you're the first person they're going to stop paying.
Yeah. And you said glorified tenant. Nick, let me clarify, because that's where my brain was going. And listen, no, No offense to anyone renting, guys. I rented for a long time. Nick has an awesome rental. Like, we're not saying— when we say glorified tenant, we mean someone that is a tenant and wants to be a buyer, but, but has messed up their credit over their life and it's been that way for 30 or 40 years. We don't— that's not what we're not talking about. The, the fantastic tenant that, that, that has good credit and just chose to rent. So on that note, Nick, like, if you take less than 3%, not in all markets, but Are you really just like equivalent? It's like equivalent to a first, last, and security in so many markets. Like, that's why, like, they're not really at risk in their head. They don't count it as a nonrefundable down payment.
Or maybe even less than that. Yeah. Or maybe. Yeah, candidly, maybe even less than that because we get a lot of people that first inquire about our properties because we have them. Well, we usually are a little bit more aggressive on the monthly. to attract the best buyer at that point. And we usually have people— I'm on the phone with them all the time— that are like, all right, well, so first someone else wants rent there. And I stop. I say, no, no, no, there's no— like, you're not doing that here. It's a down payment. You're buying a home, that kind of thing. So it's a different mindset.
I ain't going to say nothing here. All right. So a couple of things I thought of that they would— not necessarily all viewers would know, Nick. So we just had a boot camp as of the time of this filming, and we were trying to explain to these guys how systematic this has been. You've been, you've been doing this with me for 12 years now on your end. And Toby has his 4, I think it is. And there are systems in place because no matter what you put in the ad, no matter if you put bold, italicized, underlined rental only, you're going to get rental calls, right? So we're trying— we— Nick has created a system whereby it shuffles through, it weeds out a lot, not all of the tenants, and sort of lets the cream rise to the top. Why don't you talk about the system for a minute, Nick? Because they probably think, okay, great, I don't accept them, but how do we— how does this all work?
Sure. And it's really, it's really interesting that you mentioned that, that we can put it all over the ad. It doesn't matter what we put in the ad or what anyone else out there puts in the ad. Buyers are shopping or people in general are shopping based on pictures and price. They— I mean, 9 times out of 10, they're not even reading your ads. So a recent, a recent tweak that we made is we stopped putting it in the ad because it doesn't matter. Once the calls, once the calls come in, then at that point we fill them in on how it's available through our rental program. I'll chirp that.
No, no, it's good. And let me just tell this, because it's just changed since we started. You and I, it was all manual. Now, if you listen to this and you're interested in setting up your systems and you haven't yet, the white labeling and the customization we've done with our CRM that you have access to a third-party provider, but we've white labeled it, meaning we've put all our workflows in it, including the buyer workflows. We've put in our website. So you have a Done For You website with Done For You Q&A videos. Couldn't be more automated and well-oiled. Compared to when Nick and I started doing these a long time ago. So no, that's awesome, Nick. Not sure where to get started? Go to smartrealestatecoach.com/getgoing for free books, strategy calls, and a whole bunch more. We're going to help you get going the wicked smart way. We've been after this for over a decade doing exactly that. You guys want more help on this stuff? By all means, jump over to 3paydaysapprentice.com. That's number 3, 3paydaysapprentice.com. Learn more about our apprentice program. Subscribe to the channel for sure so you don't miss any videos. We come out every Sunday with a Deal Structure Sunday. I think there's 500-some-odd videos, maybe more deals that you can look through. Q&A Thursdays right here that you're watching and Motivational Monday. So be sure to subscribe. We'll see you next Thursday on the next Q&A Thursday.
