FREQUENTLY ASKED QUESTIONS

How does your Rent-to-Own or Owner Finance Program Work?

It’s simple.  Just join our VIP Buyer List so we can notify you when we get a new home, or select an existing home from our Listings page.  Our tenant-buyers love our program because it gives them the time they need to save up for a larger down payment, clean up past credit problems, sell another home, or just try out the neighborhood before buying.  Your option consideration money is credited toward the purchase price of the home.

How do you find your homes for this program?

Sometimes we work out favorable terms with the owner and pass those terms on to you.  Sometimes we purchase bank owned properties they acquired through foreclosure.  Sometimes we buy properties before they go to foreclosure.  Sometimes we buy from sellers that would have trouble getting their homes sold the traditional way.  Sometimes we pay cash, sometimes we take over payments on existing debt, sometimes the owner will finance it to us, and sometimes we just work out terms. 

What happens when I apply for a home?

Here is a summary of our process:

You will complete an application.

We will verify your information, obtain a credit report, run a background check, and when you are approved...

We will execute a few documents and set a closing date.

At closing, you pay your option consideration money (or down payment) and your first month’s payment.

You get the keys and the home is yours!

We help get you set up to repair your credit if needed and tell you what you need to do to get a mortgage in 1-2 years.  In some situations you may have longer than 2 years, and in others there may not even be a deadline (this would be owner finance).

How long does the process take?

Every transaction is different, but depending on the situation it could happen in as little as 1-2 weeks.  How long does it take us to locate a house, is the house vacant, does the seller need time to move, do we already have a home in inventory, etc. 

What are my costs?

There is no cost to join our list.  It will cost you $35 per person after you have chosen one of our homes and we approve your free application and credit report.  This covers the cost of a formal credit report, eviction searches, criminal background searches, sex offender searches, etc.  Other costs like option consideration money and rent will vary from home to home (see below for option consideration).

How can I buy a home when I have bad credit?

You can’t through conventional lenders, but you can with our help.  Through our Lease to Buy program, we can help you improve your credit over time.  We are not extremely interested in your past credit status.  Your ability to make reasonable monthly payments and your desire to be a homeowner are most important to us.  We work with fantastic mortgage brokers and banks who will help arrange a loan for you.  It is absolutely critical that you pay your rent on time every month in order to get approved for a mortgage.  We can also direct you to reputable credit repair programs.

Can you help me if I have a foreclosure or bankruptcy on my credit record?

Yes, we can help you if you have experienced a bankruptcy or a foreclosure.  We can help you if you have any type of negative credit history or even no credit history at all.  We will put you in touch with mortgage brokers and banks that we work with who help people like you get back on their feet.

I am renting now, how is this different? (Doesn't apply to owner financing)

This is a way to help you get started toward BUYING your own home NOW.  Instead of throwing your money away each month on rent and having nothing to show for it at the end of the year, with our Lease to Buy program you can be working toward purchasing the home.  With our Owner Finance program you can own it now!

Do I have to ‘qualify’ for this program?

Not in the usual sense of having to meet certain income and debt ratios, or achieving a certain credit score as would be necessary for most mortgage companies. Your credit and finances are not the restriction they would be with a conventional mortgage company.   In fact, most of our buyers do have some issues that need some time to be resolved.  When you apply for one of our homes, we do collect some basic information from you and verify it.

How much option consideration money do I need?

This program is designed for serious buyers that can demonstrate they have sufficient up front money and the ability to make monthly payments on time. Minimum required for this program varies from home to  home, but typically would be a minimum of 3% -  5% of the purchase price. If you have more than the minimum it greatly enhances our ability to find you a home fast, as we will have more flexibility to deal with a seller. The more we have to work with, the more homes we can pursue. All of your up front fee gets credited toward the purchase price when you buy the home.  For example, sometimes the seller wants a big chunk of cash, sometimes we need to pay a Realtor, sometimes we need to make up a couple of late payments if the seller is behind on their mortgage, etc.

Is the option consideration money non-refundable? (Doesn't apply to owner financing)

Yes!  If you break the lease or don’t make the monthly payment, you forfeit all of your option consideration money.  You get your option consideration money credited back towards the purchase price of the home if and when you buy it.  You need to enter into this transaction with the full intent to buy the home.

What other methods of option consideration are accepted?

Unlike most lending institutions, we accept borrowed funds for closing. If you have a close friend or relative willing to lend you money for your option consideration, you can use that with our programs. You may also be eligible to withdraw or borrow from your 401K to purchase a home without penalties.

How long is the Lease to Buy period for? (Doesn't apply to Owner Financing)

Typically we can give you up to 24 months before you would need to complete the purchase. Each property is treated individually and we try to accommodate your own situation.  However, you may buy at any time within the length of the agreement. You do not have to wait till the end of the agreement.  Also, there may be situations where you can have longer than 24 months, and other situations where there may not be a time limit at all (some owner finance situations).

How flexible do I need to be?

You need to be flexible in your terms.  There are a lot of people looking for quality Lease to Buy homes, and the good ones go fast.  We recommend you be reasonable in your expectations.  Prioritize your "must haves" and don't have too many "deal breakers", as you won't have the luxury of being too picky like a cash buyer or someone that can get a loan today (same as cash).

Is the price of the home established in advance?

Typically, yes. The price of the home is usually decided at the time you sign the Lease Agreement and is not affected by the local market conditions.

Do you arrange for owner financing?

Yes, we often sell homes with owner financing.  If you are self employed or fall in some other category where it may be difficult for you to ever get a home loan, we can provide owner financing situations where you won't have to eventually get a loan.  Obviously, these are more difficult to find, and the more money you have to work with the better chance we would have.

Who pays the property taxes and insurance during the Lease to Buy period? (Doesn't apply to owner financing)

The Home Owner does!  (Not you). You pay the monthly ‘rent’ and utilities etc., until you actually complete the purchase (just realize that your rent amount will cover these costs)

Who takes care of the repairs and maintenance for the house?

You take care of the routine maintenance.  We can arrange for you to purchase a home warranty that will cover most of the cost for repairs, with you paying the deductible  Since you should be planning to purchase the home, we expect you to have an "owner's mentality".  Caring for the home comes with the territory.  The owner will maintain property and casualty insurance on the house.  You will purchase renters insurance until you buy it.

How am I protected if the owner doesn't make the mortgage payment? (Doesn't apply to Owner Financing)

Part of our due diligence on a house is to verify the loan is current before our transaction is finalized.  If we don't already own it, the owner must give us written documentation.  Also, they are required to verify that subsequent payments are being made on time.  If they do not, it is written into the agreements that you have the right to withhold your monthly payment until such time as they can verify that all payments are current.  In a worse case scenario, let's say they quit making their payments altogether and the lender decides to foreclose.  That process could take up to a year, all the while you are living there without making any payments, which would allow you to recoup your option consideration and apply to another home.

We are experienced real estate investors in Louisville, Kentucky and surrounding areas and specialize in off-market properties.