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Rent to Own Questions

MrsChas

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Apr 6, 2008
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Hi everyone!

I was listening to Mark Loeffler`s interview on RTO, and it sounds very interesting! I have mentioned this program to someone who is in the following situation.

-Low income
-Low down payment
-Able to come up with a co-signer
-Recently paid off a large debt
-This would be a starter home for him and his fiancee

Based on the above information, would he be able to qualify for the Rent to Own Program? If no, what would he have to do and what are some options I can suggest for him?

Your advice would be appreciated, and thank you in advance.
 

tonypeters

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Oct 1, 2007
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There are many influencing factors when it comes to qualifying a "Tenant / Buyer" for the "Lease To Own" or "Rent to Own" Program. Some of which include, but are not limited to the following; Credit Rating, Income and Down Payment. There are many things (if done right) that you can do to assist the Tenant / Buyer in obtaining their own mortgage down the road, but there are some, that no matter what you do, they will NEVER qualify. The key here; is NOT to set anybody up for failure! Lease to Own is an extremely powerful real estate investing strategy, but it is imperative that it is implemented in an ethical way. Hope this helps?

QUOTE (MrsChas @ Sep 2 2009, 03:17 PM) Hi everyone!

I was listening to Mark Loeffler`s interview on RTO, and it sounds very interesting! I have mentioned this program to someone who is in the following situation.

-Low income
-Low down payment
-Able to come up with a co-signer
-Recently paid off a large debt
-This would be a starter home for him and his fiancee

Based on the above information, would he be able to qualify for the Rent to Own Program? If no, what would he have to do and what are some options I can suggest for him?

Your advice would be appreciated, and thank you in advance.
 

kboughen

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Aug 31, 2007
Messages
323
QUOTE (MrsChas @ Sep 2 2009, 05:17 PM) Based on the above information, would he be able to qualify for the Rent to Own Program?
With the consent of your Applicant, I suggest you bring your Mortgage Broker into your decision making strategy. Your Mortgage Broker will be able to determine what needs to be done for the Applicant to qualify for the mortgage at the end of the RTO Term. They may need to increase income, save a larger down payment, improve their credit, payoff debt, find an excellent cosigner or all of the above.
 

markl

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I concur many things you can fix. You say low income but is that from your perspective you say starter home what is the value as depending on where this is they may be able to afford this. I agree with Kevin take the app and get the tenant to pull their credit on Equifax score power to the mortgage broker and they will be able to help you qualify the tenant. Most mortgage brokers or the good ones can look and say if this person does these things it will take 2 years and they would then qualify for this value of a house based on their income as of today.

If you need a mortgage broker who is experienced in these matters let me know where you are I work with several across the country. Kevin can also help you out.

Regards,
 

MrsChas

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Thank you all for your advice. But another question(s) - would I need to already have an investor lined up to purchase the property (as I would be using a JV partner), or would I do this later on in the process?

And would the amount of money that the tenants would be paying during the lease term be the same as when they eventually purchase the property - or is it usually higher?

Thanks!
 

MrsChas

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Mark,

Would it be possible for me to call you? Let me know...

Thanks.
 
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