Lease Option As OO Home
My fiance and I found a great home, about 10 years old that the owner is offering to lease option with a no money down deal, $1595/ mo payment. $100 goes to future DP. House is awesome. Wants $266,000 for the house. We are not quite ready to buy it just yet. Maybe in 6 months. I believe it was probably a FC. If we want to buy it in say 6 months or so, can we do that? Or will the seller want us to lease it for the term (1 year) before we can purchase it? House is definitely worth more than $266k. Also, how can we find out what the last price paid on the house was and also what the FMV may currently be?
Thanks in advance.
You can find the purchase price of the home through public records. Here in OH that is listed on the County Auditors website--and you can look these records up by parcel ID, address, or owner so it is very handy! Perhaps you have something similar in your area. Hope this is helpful.
O.K. I'll share this secret with you, first find out what what your FHA max loan limits are in your area, then if they are at the agreed upon price or less offer an agreement of sale to the seller, this instrument is similar to a L/O but is much more advantageous to the buyer, why, because FHA recognizes the agreement of sale as ownership and after 12 months of occupancy and proof that you made the payments you can REFI your bad selves right into homeownership, so that means you can put all of your costs/fees into your new loan (providing it appraises for enough)and reduce the new loan amount by an amount corresponding with what you have paid down in your payments, give you a year to clean up any credit issues. I have converted dozens of L/O to agreement of sale and the only money the buyer put up was appraisal and credit report---cool stuff
I believe the FHA limit in GA is 175k or so.....I will double check. Thanks for the help!
Even if you can't FHA the purchase agreement is still a better deal for you than the L/O. Lease/options are nice cause they usually don't trigger due on sale clauses and in circumstances where you are really sure the house will be worth more at the end of the option period than it is now. But as a general rule-- go for th land contract.
Hey gang..thanks for the replies...I spoke with the investor...it does not seem like we are going to be able to get this L/O done. The investor wants a 3-5% non-refundable deposit that will be applied to the DP should we purchase the home during the lease term. We really are not in a position to pay 8-13k as a deposit. I do not mind that is non-refundable. He said they can do a down payment assistant plan to basically spread the deposit over the monthly payments, but if we put 2 k down then our payment is then $2100....not doable.
I was hoping to put 1k down move in asap, and then purchase the home in 6-8 months no problems. The deposit he is asking is too much for us right now. The $1595 is really at our limit per month.
Are we out of options? It seems as though if someone had 8-13k to put down, they would be able to buy a house no problems unless their credit is in absolute shambles, correct?