FAQ

Sellers: Frequently Asked Questions

Who collects rent? We encourage that Buyer and Seller have rent paid to a third party escrow company who will pay the Sellers mortgage payment directly. 

During the lease, who pays for the repairs? The Tenant-Buyer will assume all risk for repairs that are less than $1000…just as if they owned the property. A Home warranty will be placed on the home to cover any major mechanical and electrical defects.

What happens if the Buyer doesn’t exercise their option?  They ave lost their option deposit and will have to move out. Brett then markets to another Tenant-Buyer.

How often will my home be shown? Your property will be shown as often as needed. However, your property will only be shown to qualified people who have already been accepted into our program and whose funds have been verified.

What if I owe more on my home than what it is worth? We can still work with people who owe more on their property than what it is worth. Just like we have

Will this program work with short sales? Although we have been successful with lease options with short sales their are a lot of different variables that come into play. Therefore, there is no definite answer for that until we have a chance to review the entire situation. However, yes…it is possible.

Buyer: Frequently Asked Questions

Do I need to have a down payment? Yes. A minimum option deposit equal to 3% (or more) of the total purchase price, in addition to first months rent is due at the time of signing your lease and option agreement.

Will I qualify if I filed for Bankruptcy? Having a discharged chapter 7 bankruptcy in your recent past does not disqualify you from this lease option program. Nor does it disqualify you if you are currently in a chapter 13 bankruptcy. However, if you have filed for a chapter 7 bankruptcy that has not been discharged, you must wait until the chapter 7 is discharged before entering into this lease option program.

Will I qualify if I have a foreclosure in the past? Yes.  However, depending on when the foreclosure occurred will depend on how long of a lease period will be required. For example, current FHA guidelines state that a foreclosure must be seasoned 36 months before they will consider financing a borrower and generally longer for a a conventional financing.

How long is the lease period? The lease period will be a minimum of the amount of time it will take for you, the Buyer, to obtain traditional financing. The goal for this program is 6-18 months. However, depending on each individuals circumstances it could be longer or shorter.

What are the costs involved? There is NO COST to pre-qualify you. Other costs like the down payment and monthly lease payment is determined on a per property basis.

I don’t get it…how can I buy a home, with bad credit? If you are looking to purchase traditionally, you can’t. However, time is on our side. Once you pre-qualify with our loan expert you will be put on step by step program which will improve your credit over time. By the time you finish our program, you will have good enough credit to purchase the home.

How is this different from traditional renting? Every dollar that you spend in rent does nothing for you in your ultimate goal to own a property. Our program is different because each month you pay your rent on time, part of your rent is allocated as a credit when you purchase the property. This is a bit like a layaway plan for your house. *The amount of rent credit is determined on a per property basis.

What is an option deposit? It’s the amount of money being charged to purchase the “option” to purchase the property in the future.  This amount is non-refundable. If the Buyer decides to exercise their option (buys the property) then the full amount of the option is credited to them as part of their down payment of the loan. If the buyer decides not to exercise their option…then the full amount of the option deposit is non-refundable.

How long is the lease option period? The leases period is negotiable between buyer and seller. However, generally the time frame is 6-18 months.

Who pays the taxes and insurance? The homeowner will be responsible and pay the taxes and insurance until the property is sold and will also receive the tax benefit as well.

How do I know that when I pay the Seller their rent, that they will pay the house payment? We recommend that buyer and seller use a 3rd party escrow service who will send payment directly to the lender.