Home Buying Question
Hi Gil!
I am in the process of house hunting and I prefer to do a lease option for the purchase of my home...but I have poor credit. I've taken the first step to consolidating my debt and it will improve my credit history in the next 2 years. Is it better to wait to look for a home or find a lease option home buying company to help? Furthermore, what's your advice on rent to own homes? Thanks a lot for your help.
-L
__________________________________________________________
Dear L,
I commend you on taking a proactive stand on building your credit. I can tell by the tone of your letter that you are serious about correcting the mistakes of the past.
With that said, I think that lease-to-own options are a great way to work your way into a home purchase. I would like to offer a few tips though:
- Make sure that at least 12% of the rent is going toward the purchase price of the home
- If you opt to not purchase the house, see if you can get a clause written in that will at least allow you to receive a portion of that money back. If you won’t be buying that house, you could certainly buy another one.
- Don’t get so blinded by buying a house that you lose sight of restoring your credit, eliminating debt and building wealth.
- Make sure that you don’t go into purchasing the house until you are ready. Make a budget of every conceivable thing you will need to live in a home.
I think that you are well on your way to home ownership. Keep the faith and keep me informed when you decide to make that step- we’ll announce it on the site and celebrate with you.
Sincerely,
Gil