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Old 02-01-2009, 02:06 PM
 
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I am interested in either leasing a house to own (with a large down payment) or renting with an option to buy. The particular house I like however has a mortgage and the sellers don't outright own their home. Is either of these scenarios even possible without the sellersowning their home outright?
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Old 02-01-2009, 03:59 PM
 
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first question, is would the sellers even consider one of those scenarios

But quick answer, is usually yes IMO
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Old 02-01-2009, 04:11 PM
 
161 posts, read 551,757 times
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Quote:
Originally Posted by crazyma View Post
first question, is would the sellers even consider one of those scenarios

But quick answer, is usually yes IMO
If you had your house on the market for over a year, and after dropping the listing price ~75k still hadn't sold, why would you not at least entertain the offer?

How would the scenarios work if the seller didn't outright own their home?
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Old 02-01-2009, 04:36 PM
 
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Okay I'm not a professional anything, ha, but I will tell you my thoughts. Depends on if they need any anticipated profit from the sale to buy another home.

Some homes stay on the market 'just hoping' for a buyer, if they get one goody, if not they have a place to live in.

IMO many people do not want to consider either scenario. A contract for either would have to be very explicit as to what the expectations are, from each party. And yes you can still own a home and 'rent' it out, under many different scenarios.

After having had rental properties, I can tell you straight up I would not do either one. At most I would just 'rent' it out, not to own, etc.

ps- you might be better off just strictly renting somewhere, and bank your $$ for now

Are you unable to secure financing to outright buy, even with your && down?

Have you even seen the house and asked the sellers agent if the client would consider anything other than selling?
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Old 02-01-2009, 05:07 PM
 
1,097 posts, read 3,498,452 times
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Quote:
Originally Posted by movingover View Post
I am interested in either leasing a house to own (with a large down payment) or renting with an option to buy. The particular house I like however has a mortgage and the sellers don't outright own their home. Is either of these scenarios even possible without the sellersowning their home outright?
It's not uncommon but in most states selling an option to purchase will trigger the owner's due-on-sale clause, which means their note becomes immediately due in full. No matter whether it's called a "lease to own" or "lease with option" it amounts to the same thing - you give them money for the right to purchase the home in the future.

The incentive for a mortgage holder to go after someone for this is very low nowadays - they have plenty of problems with people who can't pay the mortgage as it is. But if interest rates climb back up there may be more incentive for lenders to look for this kind of thing. You have recourse if the owner is foreclosed out from under you (which could happen regardless of the due on sale clause) but good luck with that, since the owner can usually file bankruptcy and walk away.
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Old 02-01-2009, 05:23 PM
 
161 posts, read 551,757 times
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Quote:
Originally Posted by crazyma View Post
Okay I'm not a professional anything, ha, but I will tell you my thoughts. Depends on if they need any anticipated profit from the sale to buy another home.

Some homes stay on the market 'just hoping' for a buyer, if they get one goody, if not they have a place to live in.

IMO many people do not want to consider either scenario. A contract for either would have to be very explicit as to what the expectations are, from each party. And yes you can still own a home and 'rent' it out, under many different scenarios.

After having had rental properties, I can tell you straight up I would not do either one. At most I would just 'rent' it out, not to own, etc.

ps- you might be better off just strictly renting somewhere, and bank your $$ for now

Are you unable to secure financing to outright buy, even with your && down?

Have you even seen the house and asked the sellers agent if the client would consider anything other than selling?
I have plenty for downpayment and the credit and income history to go with it. My problem is my current property, which I have no idea how hard it will be to sell. So I want to buy nearby, but am anticipating trouble selling myself. This creates a bad scenario for all of course. I need to sell or was thinking I could rent my place out and rent the new place to own.
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