Olive, I have to disagree with the answer below. Leases with an option can be very good. You need a Realtor with experience in lease options.

There are some companies that offer these that are unscrupulous. Talk to Realtors in your area and ask them if they have experience or knowledge in these type of transactions.

I would advise your friend to stay away from companies that promise to help him do a lease option purchase. These types of transactions often hinge on a future appreciated value, which may or may not happen, and your friend may end up forfeiting his option money if he doesn't exercise the option.

The homes I have seen sell through a lease option are often priced much higher than market value and are not contingent upon an appraisal. Lessees typically pay a higher rental amount, too, with a portion of that amount supposedly to be credited toward the down payment at a future date. If the company dissolves or files bankruptcy, that option money is gone and so is the extra principal paid toward equity.

I would strongly suggest that your friend hire a lawyer to review all documents in such a situation and never sign a single page without first obtaining legal advice.

Of course, you can contact http://www.reiinformation.com they have a rent to own program while tenant buyers live in the home. They will work with you to repair credit until you can qualify and finance. good luck!