If you currently in a rent to own or lease option you can use the equity built up in the house your buying as the down payment! additional benefits include:

• You receive credit for equity growth in the Texas home.
• Use appraised value as your equity for rate term
• LTV based off the appraised value purchase sales price
• Must have canceled rent checks
• The agreement must have been executed over 12 months ago
to use the appraised value

• LTV determined by borrowers’ scores/credit, rate-term only, no cash-out
• Loans up to $3 million and 90% LTV with no MI
• Renter is now treated as the homeowner without being on title for qualification purposes
• The title must be transferred to the borrower at closing
• Credit scores as low as 500


Should I Buy Rent to Own or Lease Option?
Rent to own and lease with option programs can be attractive to Texas first time home buyers, especially those who expect to be in a better credit score and or financial position within a few years.

Buy with bad credit: Buyers who cannot qualify for a home loan can start buying a house with a rent to own agreement. Over time, they can work on rebuilding their credit scores, and they may be able to get a loan once it’s finally time to buy the house.

Purchase price locked in: In Texas areas with increasing home prices, Texas home buyers can get an agreement to buy at today’s price (but the purchase will take place several years in the future). Now the Texas home buyers have the option to back out if Texas home prices fall, although whether or not it makes sense financially will depend on how much they have paid under the lease option or rent to own agreement.

Test drive your Texas home: Texas home buyers can live in a home before committing to buy. As a result, they can learn about issues with the house, nightmare neighbors, and the other problems before it’s too late.

Move less: Buyers who are committed to a home and neighborhood (but unable to buy) can get into a house that they’ll eventually buy. This reduces the cost and inconvenience of moving after a few years.

Build up equity: Renters do not lock in the purchase price the way lease option rent to own homebuyers do so they cannot build equity in the same way that rent to own buyers do.When you’re in a lease to own rent to purchase situation payments can accumulate and provide a substantial sum to be put toward the home’s purchase. Buyers can also just save money in a savings account and use those funds instead (avoiding the pitfalls of rent to own, and providing the ability to buy any house).

How Do I Refinance a Texas Lease option, rent to own, lease purchase contract in Texass? Just like test-driving a lease to own or rent to own car. Renting to own a Texas home is a great way to try a Texas home out before you buy it. There are a lot of hurdles along with uncertainty when you purchase a home the traditional route. And you never really truly know if you’re making a good decision until you lived in the home for at least a year. If you rent to own the home, you can live in the home for a year and decide if it’s where you really want to live before you refinance into a traditional mortgage.

  1. Determine if you truly have a Texas rent-to-own mortgage or a rent-to-own lease. Rent-to-own mortgages are called Texas land contracts, and the buyer doesn’t actually rent the property. The seller finances the cost of the home without changing the titled ownership of the property. The title changes to the buyer only when the land contract is refinanced, and any liens on the house that the seller owes are paid in full when the home is refinanced.
  2. Provide your Texas mortgage lender with a copy of your land contract or rent to own agreement and b provide canceled checks or wire transfers documenting your timely payment history. Texas mortgage lenders analyze land contract refinances closely. While each Texas mortgage lender has its own guidelines, many will not refinance land contracts usually until you can prove a full 12 months timely payments history. They will require the house be financed as a purchase instead. If the Texas mortgage lenders consider the transaction as a purchase, the buyer may have to provide additional funds for a down payment and or closing cost..
  3. Obtain all additional documentation required by your Texas mortgage lender for the new loan. Texas mortgage lenders will require income documentation such as pay stubs, W-2s and possibly tax returns. Texas mortgage lenders may also require bank statements if funds are needed to close, or the loan program requires documenting funds to close.
  4. Stay in contact with your Texas mortgage lender during the process. Your Texas lease option refinances lender may require additional items or need to schedule an appraisal of the Texas home. These are all normal and customary items required on traditional Texas mortgage. If your Texas mortgage lender requests any additional documentation, such as additional pay stubs or letters of explanation, provide them as soon as possible. Work with your Texas mortgage lender until all the conditions are approved and the loan is clear to close!


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