• Minimum cash (Ernest Money) is required up front. Sometimes buyers with credit problems will benefit from this purchase method, since sellers may finance you, OR the method affords you time to repair less-than-stellar credit before you purchase, using a mortgage loan you acquire yourself.
  
  
• You have faster equity growth than if you were just renting, and faster than with conventional financing. Some of your rental money is working for you towards the purchase. You may have a lower down payment at closing since you will have Ernest Money and possibly rental credits to apply. By the time you purchase, prices may have appreciated beyond your locked-in price, giving you additional equity when you eventually sell.
  
  
• A lease purchase gives you the opportunity to check out all the features and faults of the house. Also, you have time to check out the neighbourhood, schools, places of worship and nearby shopping, health care facilities, and recreation, as you build equity toward purchasing the house.
  
  
• While you are leasing, you have no taxes or property insurance to pay (the owner does that). Major repairs are normally the owner's responsibility until you buy the house, at which time YOU become the owner!
  
  
• Every type of home is available for lease purchase in all price ranges and locations.

Typically, your first step is to consider a timeline. This timeline is for repairing your credit and determining the steps you need to take so that you can purchase your home within 1-2 years.  A Friend In The Business will work with you on the many options, provide for a flexible down payment and tailor the transaction to your needs.

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When Can I Move In?

Once you have been approved and have chosen a suitable property you may be in your home as soon as it is convenient for you.

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Lease Purchase Agreement

A Lease Purchase Agreement is two separate agreements between the parties: a Lease Agreement and a Purchase Agreement. The Lease Agreement is a fairly standard rental agreement. The Lease Purchase Agreement is a purchase/sale agreement whereas the tenant/buyer is contracting to purchase the house for a specified price and term. The Lease Purchase shows a definite intent to purchase the property, and sets the terms upon which the sale of the property will occur.

The value of the home may increase during the Lease Purchase Agreement term, but the price and other terms are fixed in the purchase agreement, and the seller cannot sell the house to anyone else as long as the Lease Purchase Agreement is in force.

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Owner Financing?

Simply stated, Owner Financing is a seller willing to help a buyer by financing part or all of the purchase price. Usually, the buyer makes a down payment and the seller will carry a first or second mortgage.

The Lease To Purchase Agreement has a default clause.  If the tenant/buyer does not pay the rent as agreed in the Lease Agreement or changes his mind about buying, the Purchase Agreement becomes null and void, and the Earnest Money Deposit is forfeited by the tenant/buyer.

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"Rent to Own
Sometimes you will hear that the status of a house is "Rent to Own." That generally refers to a house that is available for a lease purchase, as described above.

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