How does One buy a Home without having a Mortgage Loan?

Many people are living in rental homes as they save up to buy their own home. As life would have it, emergencies arise and most times, people tend to turn to  their savings to deal with these emergencies and this simply means that the money they are saving towards buying a home does not grow as fast as they would like  it to grow.



Many people are totally frustrated by the current banking systems because the make it very hard for  one to qualify for a mortgage and without a mortgage, it is next to impossible to save all the money you need to buy a home. But is this the end of the dream?  Indeed there are a number of options in the market to help you out and one of them is getting into a lease to own agreement.


Rent to own refers to a special kind of a lease made between a home owner and a potential buyer over a particular property. The buyer  simply rents the home and has the interest to buy it after a couple of years. The two parties agree on the sales price and the monthly rentals to be paid. If a  mortgage is out of reach, this is a great option that benefits both parties while protecting their interests.

There is a lot to be gained by all  parties in these agreements but as usual caution must be exercised to avoid falling into bad agreements. If the terms are not properly set to cater for both parties a  lot of losses can be incurred. It is therefore important for each to be fully aware of the terms stipulated in the contract they sign. Real estate agent or attorneys  should be involved to draft up the lease and explain it to their respective clients.


If do not qualify for a mortgage now, you can begin to prepare your finances in order to qualify  in the future. Meanwhile, you can put down a deposit for a home and continue paying monthly rentals and when you do qualify for a mortgage, you can go ahead  and buy the home. You and the seller must agree on the deposit amount and the monthly rentals. The lease therefore has that clause that allows you to buy the  property after some time.


This time period also gives them the chance to accumulate savings which they can use to buy the said property. Should the potential home buyer chose not to  exercise the purchase option for the property, they forfeit the fees and rent paid that far.  Some lease options may provide a clause that allows the potential buyer  to sell their option to buy, thus recovering some of the money paid in terms of rental and down payment.


 There is a lot of benefit to be derived from lease to own contracts and because of that, many people are getting into it as an achievable way towards home  ownership.