Home Buying in Mobile>Question Details

Lacey7745, Home Buyer in New York, NY

Could I rent to own with a credit score of 594??..With me and my husbands monthly income of $4000???

Asked by Lacey7745, New York, NY Sun Jul 29, 2012

My credit score is 594 would I be able to rent to own a home???. Me and my husbands income equal $4000 a month..is there anyone who
Could work with my credit score??..We are tired of renting paying all
Of this money to the landlord and never going to be able to own this house..please help!

Help the community by answering this question:

Answers

4
sure you can, call Buddy at 251-285-4730
0 votes Thank Flag Link Mon Aug 6, 2012
I hope you don’t find one, I have never known a “buyer” to succeed using this method. Don’t put up a lot of money on the front end. A lease purchase is probably not what you expect. Every single person (tenant/buyer) I have spoken to that has done one of these in the last couple of years have lost money, one guy lost $50,000 another lady $25,000 and the list goes on and on. Rent to own is probably not what you expect. In this type of transaction the underlying assumption is the seller will be able to perform in addition to the tenant/buyer. That is a very big what if, sellers are not subject to the same federal regulation as banks, do you really know the seller well enough to give them your hard earned money? I have discussed this in the blog entry linked below. Most of the sellers interested in entertaining one of these transactions will already owe money against the property so they will not (should not) want to record any contact that might trigger the due-on-sale clause in their mortgage. Unrecorded contracts are difficult to protect should something happen to the seller, divorce, illness, death just to mention a few. Other entries in my blog will also shed some light on the subject. I hope my comments give you enough to think about so you do not get hurt, good luck,

Jim Simms
NMLS # 6395
JSimms@cmcloans.com
Financing Kentucky One Home at a Time
0 votes Thank Flag Link Mon Jul 30, 2012
Agree with Trevor. In addition your FICO score needs improvement as well. Mortgage Broker may help you correct some issues. Best of Luck
0 votes Thank Flag Link Mon Jul 30, 2012
Good morning Lacey7745,

Rent To Own is a better deal for the Seller than it would ever be for a potential Buyer.

The basic concept is finding a way to "force" savings towards a down payment by including a portion of the monthly rental that goes towards that savings. You pay your rent every month and your Landlord deducts a pre-determined amount to hold in a special bank account, called an "escrow" account. Your Landlord holds that money until you have saved up enough---through this "forced-savings" method---to meet a down payment to purchase the home.

The terms of the purchase price, including the down payment amount, and the amount to be set aside from the rental for down payment, are all set down at the time of lease signing.

It's all about helping the renter/tenant save up enough money for a down payment to buy a home (in this case, the one you're renting). But this is a better deal for the Seller because he gets to lock in a purchase price and a buyer today for a future sale.


Saving money for a down payment? Well, heck, you can do that on your own.


If you are dedicated to the idea of buying your own home, you can create your own savings plan to save up enough money for a down payment. And when you have saved up enough for a down payment, if that takes a year or two or more, YOU get to decide on the price you're willing to pay for the house at that time based on current market conditions. You won't be locked in to a price that may be a lot higher than what the house is worth in the future.

With Rent To Own you'll be locked in both to the house and to the price, even if it takes you 3 years to save enough through the forced savings of the rent payments. What happens if three years from now your life situation has changed? Maybe you need a bigger/smaller home. Maybe your employment has relocated. Maybe your credit or income is insufficient to qualify for a mortgage loan.


Find a way to save up on your own; not with Rent To Own.


Sit down with a local Mortgage Banker and get yourself prequalified, too. You may find you're better qualified than you think you are, and, if you're not, at least you'll know how much loan your income and credit qualify you for, and how much you have to save towards down payment and closing costs.

Trevor Curran
NMLS #40140
0 votes Thank Flag Link Mon Jul 30, 2012
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2014 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer