Home Sale, Lease to Own Option?
I’m in a very soft market right now and wish to offer my home for sale with a lease to own, or purchase contract.
However, I want to require $20,000 down that in the event the buyer’s did not follow-through with the purchase, they would loose their down payment. Since I have a loan on the home, I cannot owner finance the home. Is this doable? Or would the leasees have ownership rights to the home?
Can my attorney draw up a contract that basically states the $20K is a down once is transfers to a purchase, if they default on the rental payments or fail to convert to a purchase in 12-18 months, they loose their $20K and walk away?
What she said..someone would have to be way beyond dumb to give you $20,000 down under those terms. Your best bet is a land contract. Call a local attorney and find out if they’re legal in your state and have her draw one up for you. Depending on the terms to evict for non-payment, you can determine how much down payment is required. You’ll have a tough time getting anyone to pay more that 2-3 times what a regular monthly payment would be.
Think about it; if someone has $20K for a down payment, why not go through standard financing?
Filed under: homes for lease to own
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Unless the contract offered was an actual Land Contract for the home, meaning the home is being purchased, I as a buyer wouldn’t touch that deal with 10 foot pole. If you want to rent the house, rent it. But don’t expect someone to rent the home with the option later to purchase and require a huge down payment in case they decide not to purchase later. That is why it is called lease with option. They have the option to buy or not to buy. They shouldn’t be penalized because they opted to not purchase.
References :
What she said..someone would have to be way beyond dumb to give you $20,000 down under those terms. Your best bet is a land contract. Call a local attorney and find out if they’re legal in your state and have her draw one up for you. Depending on the terms to evict for non-payment, you can determine how much down payment is required. You’ll have a tough time getting anyone to pay more that 2-3 times what a regular monthly payment would be.
Think about it; if someone has $20K for a down payment, why not go through standard financing?
References :
http://ohio-insurance-forum.blogspot.com/
yes, the real estate can get the 20K as a deposit. Good luck finding a tenant/buyer who will agree to that. most of the time Owner financing is for people who don’t have a deposit to put down. If someone has 20K to put down, they will 99% of the time be wanting to buy.
But technically thats what the deposit is for. In, case they default. You can not hold the mortgage unless you have the home paid for. You can hold the SECOND mortgage, but that doesn’t get you much protection if they foreclose.
Good luck
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