There are numerous reasons why some potential home buyers are trying to go this way.
Some people may have been transferred from another State and want to feel the pride of homeownership. Others may have tarnished credit or lack the funds for a true downpayment.
If you want to find out whether this sort of home purchasing method will suit your individual requirements, you need to understand what are the actual implication of entering into this type of real estate agreement.
A brief overview is outlined in the following paragraphs that will give some basic knowledge of the process.
Before signing a lease purchase agreement, you must understand what are the implications of such an agreement.
This form of real estate contract is a combination of a lease and a purchase. Meaning that you are renting the property from the property’s owner with the intention to buy it. What makes it different from just renting is that you may have given additional consideration (money) to your landlord for the option of buying the property. You must make sure you have a very well written lease purchase agreement that specificly lists your rights and obligations. Simply paying your landlord for the option to purchase the home without any form of contract will likely lead to loosing your money to an unscrupulous landlord.
One additional benefit of this type of purchase is that it can give you first hand experience at being a homeowner.
As an aspiring homeowner who is willing to try to purchase a home using a lease purchase agreement, you need be be fully aware of all specific responsibilities involved in your contract.
You need know about all the terms and conditions that are mentioned in your agreement.
- You must know what are the penalties for a late payment.
- Who is responsibe for repairs, routine maintenance.
- Any fees in additional to your monthly “Rent”.
Please be aware that most lease purchase agreement have the leasee paying for repairs and maintenance to the property.