Noreendavis, Home Buyer in Somerset, NJ

How do I find houses for sale with land contract or rent to own options? I am unable to finance a house by

Asked by Noreendavis, Somerset, NJ Sat Jun 28, 2008

conventional methods. It will realistically be a couple years (depending on the lending institutions) before I can get a conventional motgage. I currently own a home that's been rented out for 2 years in anothe state (stable income), so I'd like to sell that one and buy around the same time. In the meantime, I have decided to look for a rent to own or land contract. I am looking for a small home (2 bed fine) in the Somerset area. I also make pretty good money and would like to see it going to an investment and not a landlord. I have a small down payment (5k) and would like the selling price to be below $240,000. If anyone can give me advice on where to find a house or townhome with this option or any other advice about land contracts, I would appreciate it.

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Janeblake30, Home Buyer, Hillsborough, NJ
Sun Oct 14, 2012
There are many different strategies for property investment.
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Carlos "Alex"…, Agent, North ARlington, NJ
Sat Jun 28, 2008
Hi Noreen,

My colleagues already gave you great answers and ideas, I just would like to touch on another subject, credit restoration. Sometimes we postpone the purchase of a home because we have less than perfect credit, and the cost of borrowing just goes thru the roof. If this is your case, or somebody you know, there is now an easy solutions worth your time investigating it. Credit Restoration. There is this Non-Profit Credit Union that got my attention and I’m recommending everyone to research them. They do an incredible job restoring credit and FICO scores go up an average of 127 points p/ person.

Check it out!
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Don Tepper, Agent, Burke, VA
Sat Jun 28, 2008
To find rent to own properties, you often have to use some creativity. Most aren't listed on the MLS, despite some of the other answers below.

If you use a Realtor (a good idea, by the way), your Realtor has to go beyond searching key words. And there are plenty of ways you can find a lease purchase on your own, as well.

There really is no "best" way to find them. It depends on your neighborhood, what you're looking for, what you can afford, your comfort zone. So, read through the list and pick 3 or 4 that make sense to you.

**Using a Realtor**
[Note: If you use a Realtor--which is fine--ask them how they'd find lease-purchases. If they can't come up with more than 1 or 2 of the answers below, find another Realtor.]

--Some rent-to-owns (for simplicity's sake, from here on I'll call them lease-options--in other parts of the country, similar arrangements may be called rent-to-own, land contracts or contracts for deed) are listed in the MLS. Not too many, but some. That's where to begin. However, that's not where to end.

--Search for homes that are listed both to rent and to sell. There may not be any comment that the property is a lease-option, and maybe it didn't even occur to the seller. But a property that a seller is willing to lease, but is also willing to sell is a perfect candidate for a lease-option.

--Search for homes that are listed for rent, but were previously listed for sale. It's likely that the owner was trying to sell the house, but wasn't able to. Now he/she is willing to rent it. That's another perfect candidate for a lease-option.

--Search for homes that are listed for sale, but were previously listed for rent. In today's market, there will be fewer of them, but it happens.

--Search for homes with expired listings. The owners wanted to sell, but weren't able to. Many will consider renting the property, especially if it's vacant.

--Search for homes listed for sale that are vacant. The owners are hurting. They might appreciate the cash flow they'd receive from leasing the property.

--Search for homes listed for rent that are vacant. Again, the owners are hurting. And most owners of single family homes are "reluctant landlords." That wasn't their long-term strategy. Especially if they're bleeding, they may just want to get the property off their hands.

***Not Using a Realtor***

I'm not advising doing it yourself, but you certainly can. However, here are a few other ways to do it.

--Advertise on sites like CraigsList for a lease-option. Advertise under both the rental and purchase areas.

--Go through the papers and look for properties that owners are trying to rent out. A lot of them won't be listed in the MLS. Approach them and explain that you'd like to rent their property for awhile, then have the option to purchase it.

--Look for FSBOs. Same basic pitch to them. You'd like to buy their house, but would like to rent it first.

--Choose a neighborhood you like. Knock on doors. Ask, "Do you know anyone in this neighborhood who might be interested in selling their home?" Often, you'll turn up people before the home is listed. Again, you explain you're interested in buying, just renting awhile first.

--Put cards up in your local supermarket.

--Attend a meeting of your local real estate investors club. It may cost $10 or $15, or maybe nothing. There's usually a time near the beginning of the meeting when investors can stand up and offer or solicit deals. You can stand up, too, and announce that you're looking for a rent-to-own. Specify what you're looking for (number of bedrooms, baths), geographic location, type of property (townhouse, single family home, etc.), maximum amount you're willing to spend on rent and purchase, and anything else that's relevant. Print up some one-page factsheets with details. Make sure you put all your contact information on there. Go to for a list of investment clubs.

Hope that helps.
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Christine Ma…, Agent, Reseda, CA
Sat Jun 28, 2008
If I'm understanding you correctly, you are concerned that there might be an overlap between the purchasing a new home and selling your other home? If that's correct, then you shouldn't worry. There are plenty of homes in and around the Somerset Area. Hillsborough, alone has some nice townhouses/condos around that price range. As for the down payment, I would suggest speaking to a loan officer in New Jersey about what other means of financing are available for you. Having a smaller down payment, doesn't eliminate ALL financing options. The mortgage rep will walk you through what is available for your particular situation.

My advice is, if you haven't done so already, contact a real estate agent where your current property is, and get a feel for what the market's like out there. The agent should be able to give you an idea of how many "days on market" (DOM) the properties are averaging before being sold. This will give you a better time frame for your new purchase.
Your new purchase from offer to closing typically is around 45 days anyway. So once your current property is up for sale, I would say start your new home search. My office is in Hillsborough, so I am familiar with the Somerset County and surrounding areas. Just so you know - Hillsborough was recently ranked in the top 500 Best Places to Live in the nation by Money Magazine. I'd be happy to offer some assistance in your new home search and with any additional real estate questions, just feel free to contact me for more information.

Christine Markow
ERA Statewide Realty
Office: (908) 874-7797, ext 519
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Andrew Hunko, , 08876
Sat Jun 28, 2008

Your best bet is to get an agent involved who will do the leg work for you. If you don't have an agent that you are working with, you can contact me directly and I will see if I can help you out.
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