Mortgage lenders don't like risk and get nervous if:

• You are self-employed.
• You have less than 20% down payment.
• You don't have the closing costs.
• You have no two-year same industry work history.
• You have experienced bankruptcy or foreclosure.
• You have little or no credit history.
• You are not a citizen.
• You are recently divorced.
• You have bad credit and can't get a mortgage.

The Ins and Outs of Purchasing Property with a Lease Option

A Lease/Option program allows you to move into your new dream home now and arrange for financing at the end of a specific term, usually from 1-3 years.  The program usually works like this:

1. You purchase an Option to buy the property at some later date for a specified price.
2. You occupy the property and pay a monthly lease amount on time for the term of the lease.  The lease amount is usually $200-500 per month more than would normally be paid just to lease the property.  This premium is added to the amount paid for the option itself to build a down payment fund.
3. At the end of the lease term, you work with your bank or mortgage lener to finance the home for the selling price less the down payment fund you have accrued.

For example, with a 1 year option:

Agreed upon sales price of home           $130,000

Option price                                           8,500 –

Monthly lease premium ($300/mo)              3,600 –

Amount to finance                              $117,900

 

Lending institutions often use on-time and/or early lease payments as a factor in the loan approval process.

We have a number of properties available and several lending affiliates that can assist you with your next purchase.  If you'd like to discuss the Lease Purchase program, give us a call today at (904) 599-3095.

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Advantages To Buyer

1. No qualification necessary (credit problems are ok)

2. Option consideration is credited to eventual down payment

3. Price is locked in for term of the option

4. Time to check out the house and neighbourhood (try before you buy)

5. Time to obtain the best financing available

6. Buys time to repair credit or build extra down payment if needed

7. Quick move in time, no long or lengthy escrows or mortgage approvals

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