Where do I get information on lease options?

Asked by Juicedformovin, Seattle, WA Thu May 23, 2013

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Kary Krismer, Agent, Renton, WA
Thu May 23, 2013
Very good explanation by Dan, particularly the use of the word "schemes."

I would add that seeking out a lease option will really limit your choice of houses, which isn't a good thing when you're talking about buying houses to live in, and that you should consult an attorney about the terms of any agreement. I agree it's better to wait until you can actually buy a home.
1 vote
Dan Tabit, Agent, Issaquah, WA
Thu May 23, 2013
A lease option is a rental where some of your rent may be applied as a down payment for a future purchase of the property. Commonly the price is set at the beginning of the arrangement and an "option" is purchased to buy the home at a later date for a predetermined price.
During the rent period, you are a tenant and the owner is the landlord. If something breaks, they are responsible to fix it. If you are unable to complete the purchase when the option is due, you lose whatever you paid for the option and additional rent.
Lease/Options are really risky schemes that are designed to create the illusion of buying when you don't currently qualify for a mortgage. Unless you have full confidence that the value of the home will increase well beyond what you would pay for the home plus the other expenses and you would absolutely be able to obtain financing by the time the plan is going to expire, I wouldn't encourage one.
Doing legitimate credit repair while renting a home as strictly a rental is generally a better plan. When you do become ready to buy, you'll have more money in hand if you are careful and more options to choose from.
1 vote
Ray Akers, Agent, Seattle, WA
Thu May 23, 2013
Lease-option purchases are uncommon. Seller's are naturally reluctant to enter in to a lease-option sale in most instances as it is less attractive than an outright sale & closing. Lease-option purchases don't always make it to closing.

There is no set formula for a lease-option purchase. A lease-option purchase can be structured according to the terms & conditions agreed upon by the Buyer & Seller. Besides general information on the Internet, you may want to contact a local Realtor and discuss lease-options with them.

You should also get in touch with a local lender, and ask them to review your credit. There may be some simple steps you can take to improve your credit score in just a few months. With a higher credit score, you will have more purchase options.
0 votes
Tim Moore, Agent, Kitty Hawk, NC
Thu May 23, 2013
Google it and you will find a gazillion sites explaining it. They are not the best deals to get involved with.
0 votes
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