No Money Down Lease Option For Buying Real Estate
Qualifying for a loan can be difficult for many people. Some buyers do
not make enough money and others may not have the credit rating or may
have just gotten a new job. A lease option may be a qualifying
alternative and these deals are out there.
The lease option involves creating a sales agreement where the buyer
gains control of the property but not the ownership. The contract
spells out a future date where the property transfers ownership.
Not all properties are up to code and able to qualify for a loan without
major improvements. The seller may own the home outright without
encumbrances but realizes that the property needs an investment of both
time and energy before a bank will offer a purchaser a loan.
The lease option may fit the bill for these sellers and buyers. The
buyer can take control of the property and start the improvement
process. After a specified period of time (say 3 to 5 years) the
purchaser must buy the property from the owner. All along the purchaser
has been making lease payments and depending on the contract could be
applied to the purchase price.
The contract may call for a balloon payment at the end of the lease, but
this may not be all so bad. Hopefully the buyer has been working on the
property and both the buyer and the home will qualify for the loan. At
that time the owner is able to cash out and the buyer has his house.
It is recommended that the sales contract by drawn-up by a real estate
attorney. Both sides must understand the terms and the buyer must
understand what the consequences are if he does not follow through on
the balloon payment if the contract specifies one.
You may want to consider looking in the older neighborhoods for houses
like this. You may be surprised by what you find. The homes may be
situated on larger lots and some may even have a view.
There are many reasons why a seller would want this sales option. It is
quite common for children to place their parents into assisted care
homes when the parents can no longer take care of themselves. The grown
children may not have the time or resources to fix the house up. The
lease option deal may be the best option for both sides.
Best Syndication Staff Writer
Keywords and misspellings: reel estate estat
owned proparty properdy Best time to sell by bye a home house leese