Where do you want to live?

If you are looking to buy a home but do not have enough money for the down payment, or if your credit does not qualify you for a traditional mortgage, rent-to-own may be the best option for you. Rent-to-own can also be explained as a lease to buy option where you, the renter, sign a contract to purchase the home after one or two years of leasing. Within this time, a portion of your rent will go towards the mortgage, and you will have plenty of time to line up your financing, get with the bank and start the purchase of your home. Several things will occur, such as the banks will see that you have been living in the home for a period of time, you can afford the home and make all your payments on time. Another great reason renting to own is such a good option is because your credit score is not usually a factor as a renter it does not hold that much weight. Having a history of paying your rent on time is about all you really need. Remember, you are renting the home first with the option to buy so all the rules of renting apply to you first. Give yourself enough time on the rent to own agreement to work on your credit, and build up enough cash flow for your down payment, closing cost and insurance payment. Make sure that you use a reputable real estate agent familiar with the Renting To Own process or a lawyer to make sure all the paperwork is legal and properly done. This is very important as your future homeownership rely’s, on the accuracy and completeness of these documents. So make sure to always use legal professionals who are familiar with the entire rent to own process.

Most mortgage lending companies will not approve individuals for loans on lower credit scores. Even if you could find a company willing to approve your loan at lower credit scores you will find it comes at a very high price. Typically you will get a high-interest rate, costing you thousands of dollars with the promise that if you make your payments on time, you may be able to finance down the road to a lower interest rate. Many individuals will go down this path, only to find they have credit more debt, zero equity and their credit has not really increased. In some cases, they will owe more on the house than they actually borrowed.

What you may want to consider looking into is a reputable credit counseling company. There are good companies out there that can help you to repair your credit. It could be quick but in some cases, it may take more time in others; every case is unique.  Interview a couple of companies before committing. Make sure you understand what they guarantee, exactly what services they will provide and how long those services are available to you. You need to also understand what is required on your part, are there any upcharges or other expected charges. Then make sure to stay on top of things, get regular updates and check with the credit companies individually on your own.

If you have too much debt and you can not seem to get out from under it. Then consider contacting a Debt Relief Company. This will take longer and your credit will take a hit before it improves. Debt Relief Companies will negotiate on your behalf to reduce the amount you owe them. You will have to make monthly deposits to the Debt Relief Company but they use those funds to negotiate a lower debt amount and then to make the payments on those commitments. If you stick with the program, then at the end you will be financially in a better place. Then adjust your focus to credit repair before you know it you will have an increased credit score and all your debts gone. Now you’re on the right path to purchase that new home.