The Lease Option
Thinking about buying some property or a house? Worried about your bad credit history, or perhaps you do not have any credit history at all? Worried you will never qualify for a loan? Well do not give up just yet, there maybe an option still left for you, that is, the lease option.
What is a lease option?
What a lease option does is it allows a renter to buy a property, or in other words it gives the renter an option to buy the property within a certain time period. In most cases when buying a house, part of the future down payment is paid by a portion of the rent. Most people who use the lease option are those that do not have sufficient funds to make a down payment and to pay for closing costs. Usually a lease agreement is found more when the market is slow, because if it were to be hot the seller would not use the lease option and would be able to cash in more by selling the property. Young Families find it very hard to come up with enough money to make a down payment, but with something such as private mortgage insurance, it can be done in about half the time.
What the renter needs to know about lease options:
The portion of your rent that would go towards the purchase is usually only used when rental payments are greater than the normal market rent. The real estate world can be tricky, make sure you read all of the paperwork and have someone that knows what they are doing read through it with you to make sure you do not have any unsolved concerns. Do your homework. Make sure your property that you are thinking about using the lease option on has a set price at the time of signing any contract. This is very beneficial because if the market gets hot during your contract, your property value will go up and you will still be paying the same amount agreed upon at the start of your contract. Find out if your contract is “assignable” or “non-assignable.” Most contracts are “non-assignable,” but if they are not, then the person that is renting may be able to sell the property at the fixed market price and be able to cash in a little extra by doing so. Be sure to seek legal advice. Employing a real estate attorney is also a good option.A word of caution:
Lease options are usually used by those who do not qualify for a loan and therefore try to use a lease option thinking that they will qualify on a future date. However if you do not qualify, any money used to pay your payments or money paid upfront will be lost seeing that you were not able to make a big enough down payment. Therefore make sure that at the time of the purchase date, you will qualify for a loan by your employment status, your assets and savings. Another con of the lease option can be that if the market goes down during the period of your contract, you may be forced to buy at a price higher than market value and the seller will still demand a mortgage commitment.
What the seller needs to know about lease options
· The best time to use a lease option on your property that you want to sell is when the market is slow. That way you can ensure that it is sold.
· If the renter is not able to make a down payment after the rental agreement is up, you get to cash in on the money collected from the payments made.
· Be careful that you do not get locked into a deal where you have to sell at a price that is lower than market value.
· Be careful of changes made during the rental process such as financial status and so forth.
More Information on how to be successful in the real estate world is found at www.oneminutemillionare.com.
Jason Luke is a Client Account Specialist for 10X Marketing. Go now to One Minute Millionaire to find out more about real estate and its benefits.
Related Tags: real estate, lease agreement, lease option, private mortgage insurance, one minute millionaire
Your Article Search Directory : Find in Articles
Recent articles in this category:
- The Resurgence of Fred Perry Clothing
Summer might long be over and Wimbledon may be a distant memory, however the fashion is a year round - Uncovering Men's Tank Tops
I don't know a thing about you, but I'll bet that you have worn a tank top. Tank tops have also been - Make Use of Silk Scarves to Take Good Care of Your Skin
In the event you are new about silk scarves, you could never read about this particular feature of s - Just For Men Scarves - the Preference For Guys in the Vogue Domain
If you are not certain what style of present you could provide for men, maybe you can consider men s - Think Black Friday Shopping is Beyond Your Budget?
Moms who are juggling the bills and still trying to provide the perfect holiday gift to loved ones a - How to Make Conscious Shopping Choices
Many people have heard the phrase "voting with your dollars" and they understand that it means your - Silk Scarves - Unique Present Approach in Xmas Seasons
The most prevalent silk add-on is scarves, and many focus is presented on inspired designing on thes - Benefits of an Aloe Vera Shampoo
A lot of people are not aware of the specific benefits that using an aloe vera shampoo can do to the - How Effective is the Power of Your Subconscious Mind?
Most people are bombarded with this thought whenever they feel weak and wish to affect certain chang - Silk Scarf - the Record For Human Being in the Style History
Throughout the 19th and 20th centuries the worldwide recognition of silk scarves developed dramatica
Most viewed articles in this category:
- Surf and Turf: the Race Track
Surf and Turf: The Race TrackOne of the favorite places for The G to hang out at, especially in Summ - Are You Looking For Cholesterol Drugs Without Side Effect?
High cholesterol level is probably one of the widely spread complication among Americans. Almost for - Friday the 13th could be a lucky day?
Friday the 13th sounds unlucky ? Traditional superstition ? And a lot of people dislike it and beli - Don't Judge A Man
Our world is full of bad tongues, fault-finders, gossipers, mockers, and insulters but do these grou - When Personalized Gifts Make a Difference
Finding the right gifts for a particular occasion is always a challenging task. Sometimes it is nic - Managing My Resistance: Learning To Flow With What Life Offers
One of the things that interests me most about conflict is the tendency to resist it and the ways in - What Are Horoscopes Based On?
If you do not know much about astrology, you may wonder what are horoscopes based on and how astrolo - 7 Dumbest Relationship Mistakes Smart People Make
We often find ourselves amid the wreckage of a love gone wrong, wringing our hands and asking, "Why - Motivation as the heart of self improvement
You should be able to find several indispensable facts about Motivation in the following paragraphs - Is Complete Abstinence from Use of Paychoactive Substances Necessary for Recovery?
Can a sober alcoholic in recovery who has no history of abuse of marijuana, use marijuana without