What is a lease-to-own house purchase? Well, a lease-to-own house purchase (sometimes also known as “lease purchase” or “rent-to-own”) is a lease combined with an option to purchase the property within a specified period, usually 3 years or less, for an agreed consideration.
What many people do not realize is that by utilizing a lease-to-own purchase, they can afford their dream home though it may initially look beyond their means. By using this facility, there are some benefits that you can enjoy, one of which is that it gives you time to repair your credit.
Most of the lease-to-own companies will work with you notwithstanding your imperfect credit. During the course of the lease-to-own period which usully runs between 2 to 3 years, the company will work with you to help repair, rebuild and re-establish your credit. Through this method, it is envisaged that by the time the term is complete, your credit would have been in a much better standing to qualify for mortgages.
Using lease-to-own also allows you to start home ownership with less down payment. If raising 10% down payment beyond your means, you can look at lease-to-own homes where the usual rates are between 3% to 5% for down payments.
Lease-to-own homes also allow you to lock into the purchase price of today as the price of the house will not fluctuate but rather, is tied down to the lease-to-own purchase agreement.