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Is it possible to have an investor buy our current rental and lease it back to us?

My husband and I have been in the process of trying to buy our current rental home and we are having a hard time getting approved for a loan. My husband had 6 years on the job at 150,000 a year. We have made the mistake of not rebuilding our credit since our foreclosure 5 years ago. To add to the scenario my husband still has the same job but has switched companies for various reasons. We need some answers and help as to what to do. The owners want us to purchase the house by next month. They want to buy another property and we really want to stay where we are. Is there a way to get in touch with an investor to buy the house and lease it back to us with a lease purchase agreement?
  • July 20 2014 - Gateway
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Answers (5)

Best Answer

Hello, I didn't see anyone really answering your question.  Yes, an investor can purchase this home and lease it back to you.  You would have the option to set up a lease option to buy with the new investor owner and down the road you would be able to complete your  goals by purchasing it from the investor.

In regard to the investor purchase, in most cases it would require 15% down and they could set up a 30 year term on the loan.  There are typical costs to close the loan and as an investment purchase the buyer may see some costs that are slightly higher than a non investor purchase.  We need to know if this investor has other properties that have mortgageson them, there are some limitations to how many mortgages an investor can hold at one time.

If you want more information please feel free to check my profile for my contact information.
  • August 20 2014
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You really need to talk to a lender that you trust to get some good advice. It was not stated if you have a down payment for this purchase or not, maybe that is your problem and you have a lack of cash? Or if you don't have reestablished credit, or still have a low credit score, yes, that would be a problem. The answer to your question is that you can certainly try and find an investor who may want to buy this property to lease it to you with a lease purchase option. But in my opinion you will not find such an investor. Think about it, they would be paying closing costs, expending capital, and going through the hassle of buying a property, only to do a lease back with an option for you to purchase it in a year two. It doesn't seem like there's much profit in that proposition for them. And I personally think I would stay away from a "Hardmoney" lender, the costs are very high with those types of letters. I think you would be better off reestablishing credit, and buying something with a normal mortgage at a market interest-rate. Talk to a lender, see if you can get qualified to purchase the place; and if not you may have to find a new place to rent until you can get your credit reestablished and try again.
  • July 21 2014
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Thank you for the answers. No, this was not a rent to own.
  • July 21 2014
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Was this "rent to own"?  It sounds like a typical problem. 

You may wish to consider contacting a hard money lender. They are willing to take more risk but require a large down payment, higher costs to get the loan and higher interest rates.

  • July 21 2014
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Typically you only need 4 years from the foreclosure and you can buy. As long as your husband is in the same trade he should be ok as well. Call Mike Tessmer or Matt Odom from Fairivew Lending and they can see if they can get you financed. Feel free to tell them I sent you and call or email me if you have any questions.[contact information deleted by Zillow moderator. Please see our Good Neighbor Policy for posting guidelines]
  • July 21 2014
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