| Lease to own is way to purchase a home thru a | | | | in such a way that the home is unaffordable to |
| lease. The buyer lease the home until the buyer | | | | purchase the home. As the buyer locks the home |
| decides to purchase the home. Within the lease | | | | price, the buyer gains home equity right away. By the |
| agreement, the buyer finally purchases the home. | | | | time of purchase, the home must have increase in |
| The buyer can choose between lease purchase or | | | | value. Thereby, the buyer gains home equity. |
| lease options. The buyer will absolutely purchase the | | | | Try before the actual purchase |
| home with lease purchase, while the buyer may | | | | The buyer can give the home a try. The buyer can |
| decide to purchase the home with lease option. Here | | | | know any defects for the home while the buyer is on |
| are list of advantages to the buyer and seller of the | | | | a lease. If the buyer is comfortable with the location, |
| home. | | | | and home, the buyer may go ahead to purchase the |
| Purchase home with bad credit history | | | | home. |
| The financial institution uses the credit score to see the | | | | None or little mortgage closing costs |
| ability for the buyer to afford the mortgage repayment. | | | | The lease includes the lease and premium. The |
| Any score above 660 places the buyer on good credit | | | | premium is added at the time of purchase. And, the |
| history. Sometimes, the debt gets a little out of hand. | | | | premium is used as credit to purchase the home. The |
| And, the buyer goes under bad credit score. | | | | premium may be large enough to pay off the down |
| Lease purchase allows the buyer to catch up with the | | | | payment and closing costs to finance the mortgage. |
| credit score. The duration of lease agreement gives | | | | Costs less to maintain |
| the buyer time to repair bad credit rating. Usually, the | | | | The seller pays for the maintenance of the property |
| lease agreement spans between one and three year. | | | | while the buyer pays the lease. The seller pays for |
| So, the buyer has one to three years to repair bad | | | | property tax, insurance, and repairs. After the buyer |
| credit rating. | | | | actually purchases the home, the buyer starts to pay |
| Locks the home price | | | | the property tax, insurance, and repairs. |
| The seller and buyer agree on the price of home. | | | | Tax deduction |
| When the buyer is ready to make the purchase of the | | | | The seller still owns the home while the buyer still |
| home, the buyer applies for mortgage financing with | | | | paying the lease. The seller can claim the mortgage |
| the agreed price of the home. If the home increases in | | | | interest. The mortgage interest tax deduction is useful |
| value, the buyers can resale the home at a higher | | | | way to reduce tax each year. A big portion of the |
| price. | | | | mortgage payment is mortgage interest. The |
| Equity starts to grow sooner | | | | mortgage interest is at the biggest at the start of |
| If the buyer waits to purchase a home, the home may | | | | mortgage. The mortgage interest gets smaller over |
| increase in value. The value of the home may increase | | | | time. |