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Jennifer Mar…, Renter in Warrenton, MO

My credit score is 608 my husband is 591. Will we have an issue getting approved for lease purchase option with builder and bank?

Asked by Jennifer Martin, Warrenton, MO Mon Feb 6, 2012

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Please let me know if you would like some references of lenders who can answer this question better.
1 vote Thank Flag Link Mon Feb 6, 2012
Hi Jennifer,

You will definitely want to find out how to increase your particular credit scores. I would be happy to pull your credit for free and give you one on one assistance @ 636-399-1692. I prefer to meet clients in person and we have 4 offices throughout St. Louis.

http://www.kylehaslowrates.com

Kyle D. Weaver
USA Mortgage
636-399-1692
Licensed Mortgage Loan Officer
NMLS 235637 MLO: 1639 MO
0 votes Thank Flag Link Wed Feb 22, 2012
Jennifer, try the NACA program, no downpayment, no credit score. No bankruptcy or foreclosure. Not credit score driven. Call me and lets talk, cost you nothing to learn more. 314-304-3324 vernae@gmail.com
0 votes Thank Flag Link Fri Feb 17, 2012
There are several lenders out that will help. However, I know of a program, no money down, no closing cost and you buy down points. This program help you get your credit together without you having to pay fees.
If you want more info call me or email me 314-337-7299 vernae@gmail.com
0 votes Thank Flag Link Mon Feb 6, 2012
Builders seldom are involved with lease-options. Banks never are.

With a lease-option, you're leasing. It's a lease.

Then, at some point, you exercise your option and purchase. At that point, you're using conventional financing. There's no special "lease-option" or "lease-purchase" loan. The bank just looks at you like a buyer. (It's possible, if it's properly structured, to get credit for the time you were leasing. But it's still a conventional loan.)

By the way, never, ever, ever agree to a lease-option of under a year. In fact, stay away from anything less than two years. Try for three to five.

Why?

Because you're fairly typical--you and your husband both want to improve your credit scores, and probably need to in order to get conventional financing. That won't work in 6 months. It takes a while to raise your scores, and it takes a while for your actions (paying down credit cards, paying off some debts, etc.) to "ripple through" and affect your credit. With a 6-month option, you'd have to apply for financing in 4 months. I doubt any lender will tell you, with a straight face, that they can assure you that your credit scores will be where they need to be in 4 months.

Look: If you can get your credit scores to where they need to be in 4 months, don't do a lease-option or lease-purchase. Just wait 4 months and buy conventionally. (And I'm a big advocate of lease-options . . . in the right situation. But if you can buy conventionally in 4 months, that's NOT the right situation for a lease-option.)

So: As some of the others advise--contact a lender. Have him/her run your scores and give you some guidance on what to do to raise them . . . and, realistically, how long that'll take. Then, if you do go the lease-purchase or lease-option route, settle for an absolute minimum time period of two years or double whatever the lender projects . . . whichever is longer.

Hope that helps.
0 votes Thank Flag Link Mon Feb 6, 2012
Don Tepper, Real Estate Pro in Burke, VA
MVP'08
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Hi Jennifer typically most lenders are looking for a credit score of at least a 620. That may vary and is not written in stone. My best advise would be to contact a mortgage lender to answer any financial questions you may have. If you do not have a mortgage lender, please feel free to contact me and I would offer a couple of lenders to choose from
0 votes Thank Flag Link Mon Feb 6, 2012
HI Ted can you please send me some information on who I could check with. Send it to cardinalsstl07@gmail.com

Thank you,
0 votes Thank Flag Link Mon Feb 6, 2012
If you need more names of lenders, please let me know. I believe Wells Fargo is running competitive offers with lower credit scores which you may want to check out.
0 votes Thank Flag Link Mon Feb 6, 2012
The lease option is designed to work with scores below 620. The idea of the option is take the next 6 to 12 months to work on your credit and raise your scores so that you can qualify and the end of the option. You may take Ted up on his offer and see if one of his lenders can do a rapid rescore which would help you get into a house now instead of doing the lease option.
0 votes Thank Flag Link Mon Feb 6, 2012
The best way to evaluate your credit situation is to have a conversation with a lender. A lender will look at your credit score and let you know what you qualify for, and if you do have some items on your credit report to correct they can adivse of the best way to do it. A conversation with a lender is free and the lender will also provide the pre-approval letter that should accompany any offer that you submit.
I have great lender to recommend if you need a referral.
Patti Leonard
Keller Williams Realty
314-283-3147
0 votes Thank Flag Link Mon Feb 6, 2012
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