Phoenix and Scottsdale area lenders are tightening their lending practices. It is increasingly more and more difficult for home buyers to get loans.

Now 100% loans, or ‘majority financing‘ is a very limited option, buyers and sellers have to be creative to get real estate transaction closed.

There are 2 strategies that may work; The Lease-option and the Lease Purchase.

A common name you may here these referred to is “Rent-to-Own” .

I have to recommend that you do not attempt this without the advice of an experienced attorney and/or real estate professional.

Lease option – “contract in which an owner leases her house (usually for one to five years) to a tenant for a specific monthly rent, and which gives the tenant the right to buy the house at the end of the lease period for a price established in advance”

Lease Purchase – “a Lease to Purchase contract combines a basic lease contract with an option to purchase contract, which creates a Lease to Purchase contract.” The main difference being that the lease purchase contract, the Buyer is obligated to buy; if not, the buyer would likely be in breach.

Again, both contracts can provide language where a portion or all of the rent payments can go towards the purchase of the home. Thus, allowing the buyer to accumulate down payment to more easily obtain a loan.

Hire a real estate attorney or experienced real estate professionals who can prepare documents, explain and protect your interests.

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Copyright © 2008 By James Wexler, All Rights Reserved. *Lease Option vs. Lease Purchase*

Contact James Wexler (480) 221-8080 for all your Phoenix | Scottsdale area Real Estate needs.