How Does a Lease Option Work?
You select the home of your choice. You negotiate the final sales price, which is the price you will pay when you purchase the house. You put a small amount down and make monthly lease payments. A portion of your payment goes to reduce the amount you owe for the house when your lease option term (usually 12-18 months) is ended. During this time, you re-establish your credit by working with the credit repair people. At the end of your lease option agreement, you obtain a mortgage and buy the home at the agreed upon price. All the terms, conditions, payments and price are spelled out in writing in your lease purchase and real estate purchase contracts. You have time to get your credit back in shape before trying to qualify for a loan.
