I love the power of Activerain, I get lots of business from my blog posts, even ones that are three and a half years old are still getting me calls. But, some of those posts I wrote three years ago don’t apply to today’s real estate market.
Many of those posts were how to use lease options to buy Beaverton real estate, heck, I was using it to purchase and sell real estate. The problem with buying real estate that way today is that you are agreeing to a set price today that may not be the same next year. That is fine when the value is going up, but when you are paying more than market rents, $5,000 or more in option money, if the value of the property drops below the price you agreed to the bank will never finance the property if you are able to fix your credit in that year.
This leaves the seller with two choices, the first is to lower the price so you can purchase the house at today’s value, the second, and the one the seller will choose every time is, “Sorry, you can’t complete the contract and you are going to have to move out and I’m keeping your option money.”
Then what the seller does is puts the home back on the market as a lease option again, collects another $5,000 or more, and waits the year for the buyer to default on the agreement. It is a no-win situation for a buyer right now when it comes to lease option. What I suggest is doing owner financing and make sure you they are willing to carry the contract at least 10 years or you could be in the very same situation of not being able to refinance and have to give up the home.
If you are looking to buy or sell in Beaverton, Oregon, give us a call at the Friendly Home Team and let us help you with your options and you may be in a home sooner than you think! Many times a buyer who thinks they don’t qualify with our programs can be in a home in less than six months on a traditional loan.