Has anyone ever bought a home thru a lease to own situation?

What where the pro's and con's and would you recommend this to other people? My husband and I have so-so credit. When we were first married we made bad choices, but that was 8 years ago and we have tried to only do positive. But, we are worried that we still wont be approved for a home loan and that a lease/purchase might be our only option. So any input would be nice. Thanks

My ex-husband and I purchased a home via lease to own. I would say the biggest disadvantage is that there is usually a large down payment required which you do not get back if you do not buy the home. Also, you are not building your credit while in a lease to own situation.

My advice is to apply for a home loan. I was approved with fairly poor credit after my divorce on my income alone. So, don't think it's impossible. It doesn't hurt to try. Explore all options first!

Best of luck!

There's nothing wrong with it, esp. if your credit is poor. It can only improve with time. What is most important is to fix the ultimate purchase price and what is second most important is to get some portion of the rent applied to the purchase price.

edit. There is no reason to accept a non-refundable down payment.

Fixing your credit will be a better way to go, because you aren't tie to the place you are leasing, in case you changed a job or the school district goes bad.

People get approve for poor credit, there are many ways around it. Like your interest rate might be higher than other ppl who get good credit. But work with a loan officer who knows what is going.

Even though I am a Realtor/Broker....I am also not an attorney.

The seller has a representative to write up a lease to own contract...there is NO consistency in the industry on how these things are written.

That is why when someone is thinking about doing a lease to own, that the perspective owner get their OWN attorney to look over the paperwork thoroughly and make sure they understand exactly how it works.

Realtors are not legally permitted to make an interpretation of such a contract. That is giving legal advice without a license.

one idea is to find a loan company that does manual underwriting. which means they don't just look at your credit score. they look at your situation. if you've been renting for 2 years and have always paid on time--that is good credit to them. they just tend to look at each loan as individual as opposed to looking at just the credit score #. don't get in a big rush to buy, if you've been doing good for 8 years, i think you'll have the best luck with the manual underwriter. it's usually smaller companies that do this, just call them up and ask them first thing if they do that--they'll tell you without wasting your time.