Frequently Asked Questions

Frequently Asked Questions

Q. You state that your program is No Credit Qualifying. Why do I have to make an application?

A. While our rent to own / lease to own program is no credit qualifying every applicant must qualify for our program. We are not in the eviction business and don’t want to be. It doesn’t do us or you any good to take up-front Option money and then put you in a home that you can’t afford or that you won’t be able to qualify for prior to expiration of the Option.

Q. What are you looking for to qualify for your program?

A. We look at a number of things. First and foremost, we are looking for people who truly want to become homeowners. There are numerous Lease Option programs out there that simply want to take your option money, rent to you for a year and then for you to move out so that they can repeat the process. This isn’t us. We want to help you and your family achieve financial success and become homeowners! This is why we require that you sign up for a credit repair program. Secondly, we are looking for your ability to pay for the home. You must be able to verify that you can afford the payment and have steady income. For more information on qualifications, please click here: http://www.financethedream.com/enrollnow

Q. Why do you pull our credit?

A. There are two reasons. First, we need to make sure that we aren’t getting you in over your head. We want to build solid long term relationships with you. The last thing we want is for you to be overextended with other debt and not be able to afford your home. The second is that because our lease option program is truly designed to help you become a homeowner, we need to understand what it is going to take to make that happen.

Q. I make a good income, but can’t verify it in traditional ways. Does this mean that I can’t qualify for your program?

A. No, not at all. We can look at non-traditional sources of verification. The key thing that must be considered is that because Stated Income Mortgages are a thing of the past, we need to ensure that steps are taken so that you can purchase the home in two years.

Q. What makes your program better than other programs out there?

A. There are certainly other reputable Lease Option programs out there, but we think that ours has something special. Our approach is unique in that we are seeking to build a long term relationship with you. First and foremost, the terms of the lease option are set up to actually put you in position to buy the home — this is important. Many lease option programs are set up so that at the end of the term there is no way you could ever buy the home unless you paid for it in cash and for a price significantly above true fair market value.

Q. How can the terms of a lease option affect my ability to buy?

A. The terms of any lease option are critical to your success! Unfortunately, there are many programs out there whose sole purpose is to rent the home to you for a year, collect upfront option money and then for you to be forced to move out in a year. Why? So that they can collect the option money again from someone else! How do they do this? First, they set the option price far above what they estimate that the Fair Market Value of the home will be. This ensures that even if your credit is perfect, no bank would finance the home for you because the home isn’t worth what you’d be paying for it. Secondly, they offer little or limited rent credit and do nothing to help you save up for the down payment. We offer a generous rent credit and the ability to take advantage of money making opportunities with our company. Lastly, they do not require you to work on repairing your credit because quite simply they don’t want you to!

Q. Why do you do all this?

A. We’ve been there. We know that life throws you curve balls and sometimes your credit gets damaged and makes things difficult. When we say that we are looking for long term relationships, we mean it. Our long term goal is to see you and your family successful and for you to be so happy with what we have done that you are compelled to refer your family and friends.

Q. Why do you require an application prior to viewing the home?

A. A good Real Estate Agent will always require a client to get pre-approved with a mortgage company prior to showing them any home. The reason for this is to ensure that no ones time is wasted. It is heartbreaking for you and frustrating for the person who takes the time and to show you the home. (Usually a Real Estate agent) We do ask that you drive by the home first and make sure that you like the area and neighborhood.

Q. What is your application fee?

A. Our application fee is currently $37. This covers the hard cost of credit reports as well as the cost of an employee to process your application.

Q. What exactly is a lease option?  What is the difference between rent to own, lease option and a lease purchase agreement?

A. A lease option is a contract where you lease a property for a specific period and have the option to purchase the property at any time during this period for a pre-determined price. A portion of each month’s rent goes towards the purchase price of the home. At the end of the term, you have the right to buy the home but you are not required to do so.  A rent to own contract works in the same way.  A lease purchase contract typically requires that you purchase the home at the end of the lease term.  We do not usually offer lease purchase homes, but you may see the term used interchangeably on our website because many people understand the lease to purchase concept but not lease options.  The challenge we find with lease to purchase homes is that they do not provide you the option as to whether or now you wish to purchase the home.  If this is the way you want to structure the deal, it is more beneficial for you to do owner financing because of the potential tax benefits.

Q. What is the term of your lease?

A. Our typical lease term is 24 months. We do this because in our experience, it can take a minimum of two years for you to repair your credit to the point that you would be able to qualify for traditional financing. Of course, you are free to exercise your option at any time during the 24 month period.

Q. What down payment/deposit is typically required?

A. Based on your situation and the deal we negotiate with the seller of the property,  non-refundable option fees and down payments range between 2-5% of the purchase price of the home. 99% of the deals we do require nothing more than the first month’s payment and 2% of the purchase price for the option fee or down payment at contract execution.

Q. I am currently looking to rebuild my credit and find a home. But I do not have the money for a down payment at this time. How can this program still help me?

A. There are two ways that our program can help you. If you have some cash saved up and are ready to move, you can enroll in our program and see if you qualify for our down payment assistance program. This can help you get into a home for as little as the first months lease payment + $500. (On homes in inventory)

If you do not qualify for down payment assistance (or aren’t ready to move yet), but are still serious about owning a home, then we highly recommend you going ahead and choosing the credit repair program that best suits your needs.

Once you are enrolled, you can begin the process of re-building your credit and put yourself in the best possible position to own a home!

Q. I really like your program, but you don’t have a home in inventory that meets my needs. Can you still help me?

A. Yes! You can enroll in our custom HomeFinder program. With this program we can find you a home anywhere in the U.S.!

Q. Can you tell me more about your HomeFinder process?

A.

  1. Complete the Enrollment Application
  2. Once the Enrollment Application is completed, sign up for the Platinum level custom HomeFinder Service
  3. Once you have signed up, it will redirect you to the HomeFinder Form. Fill it out and be as specific as possible about what you want and don’t want. I need to know deal makers and deal breakers
  4. Email us the HomeFinder Form. Upon receipt, we I will begin searching for properties that match your description, get them under contract and help you get into them with a minimum of hassle

Q. I need a cheaper payment than any of the homes you have in inventory. Can you still help?

A. Yes! We acquire inventory based on the needs of a majority of our clientele. This doesn’t mean that we have a certain minimum payment that we can help you with.

Just like anyone else, you would need to enroll in our HomeFinder program so that we can find you a home that is specific to your needs.

Q. I have found my dream home, but it is listed with a Realtor. Can you still help?

A. Yes, we can, provided that you sign up for the highest level of service via our HomeFinder program.

We can’t guarantee that we can get a specific home under contract for you. Even so, we will NOT contact a Realtor without a strong commitment from your.

There are several reasons for this.

Based on our experience, it will take us 5x the effort to negotiate a deal with a Realtor than if we go directly to the seller. Realtors don’t always understand our program and it is typically difficult for them to explain it to their client. Most often, they want to maintain control of the situation, so the seller never truly understands our program.

While we have done some great deals with AMAZING Realtors, unfortunately, there are many out there that are only interested in their commission. As such, there is little motivation for them to facilitate the leasing of a property when they can make between 3% and 7% on a sale. (Which they can still do with us – it just won’t be for 24 months.)

Q. I’ve seen a home listed with an agent. I want to enroll in your HomeFinder program. Should I contact the agent directly?

A. Let us help you here so you don’t unknowingly shoot yourself in the foot. If you want us to help you, under NO circumstances do you contact a Realtor or seller directly on any property that you may want.

Here’s why:

When you contact a Realtor or seller directly, they think that you are inquiring to purchase the property with cash or a mortgage. When we then contact them for an owner finance/lease purchase deal and they find out you are the buyer, they feel deceived and it can blow the deal up.

It is best to let us go in the honesty up front and explain the entire deal to them. That way, they immediately have all of the information they need to determine if our program is a good fit.

Q. What does Rent Credit Mean?

A. The rent credit is the amount of your rent that goes towards the purchase price of your home when a lease option contract is utilized. Every situation is unique, but typical rent credits offer a percentage of your rent in a rent credit for on time payments. This will hopefully (no one can predict mortgage guidelines 24 months from now) allow you to purchase the home without additional down payment or closing costs out of your pocket.

Q. What happens I don’t make my payment on the first of the month?

A. We have investors to answer to, and as such, it is imperative that you make your payment on time, without exception. You are incentivized to do this via the rent credit that you receive only if the payment is made on the first of the month. There is no grace period and if they payment is made on the second, you lose the entire rent credit for the month. You are literally throwing money away!

Q. Do You Require that I Enroll in Credit Repair?

A. Unequivocally, YES!  Why? Most owner finance transactions never consummate and the tenant/buyers end up spending inordinate amounts of money for down payments or option fees, improvements to the property, etc., only to lose all of their money because they did not do what was necessary to qualify for a mortgage. So, we require it for the following reasons:

  1. We genuinely care whether or not you actually get to own the home
  2. It is a litmus test for the seriousness and commitment of someone as to their level of sincerity about straightening out their financial life
  3. It is a selling point with sellers that enables us to get people with extremely derogatory credit into a home with ease when they otherwise wouldn’t be able to
  4. And, simply because sellers want an assurance that if they are going to allow someone into their home that has a recent proven and documented track record of not paying their bills on time that the individual is serious about credit restoration to get fast tracked for mortgage qualification (and they aren’t dealing with another deadbeat tenant with a bunch of excuses who isn’t serious about buying the home). You see, the sellers want to sell, not be landlords. Our program provides them with the fastest approach to doing that using a creative short term owner financing bridge and a serious buyer. Like several of our other program guidelines, the credit restoration requirement is designed and instituted to be a purposeful road block for non-serious time wasters who talk a great game but don’t follow through. It is there to weed out game players. People often ask, “how long do I have to pay for the credit restoration program?” to which I answer, “That’s the best part! It is entirely up to you. You only have to pay for it until you are qualified for a mortgage. So, the faster you do what we advise, the less time you have to be enrolled and pay.”
Q. I am already in Credit Repair. Do I need to enroll again?
A. Yes. Here’s why?: We do not advocate hiring a service to do it for you because they can only do one thing on your behalf …..send out dispute letters. There are a myriad of things that only you can do that will highly accelerate your credit restoration and get your scores up faster. The key is having the requisite knowledge of the strategies and laws that pertain to your particular situation and then taking the time to implement them. And that’s where Credit Repair College comes in to empower you with the information, systems, methodologies, strategies and laws to help you take control and get the job done right and in the shortest possible time frame. Sound like sales pitch? We just recently got a legitimate $16,000 credit card collection account removed from my mother in law’s credit report using the debt validation process and she just closed on a mortgage. With the collection account reporting, she was declined for the mortgage. All it took was knowledge of the appropriate law, methodology and strategy to implement and one simple letter. Knowledge is power. Reliance on someone else is weakness. That’s why we empower our clients. No credit repair company could have done for her what she was able to do.
So ultimately you have to decide if you are content spinning your wheels never making it past the starting line or if you would rather push the nitrous oxide button and win the race.
Q. Can You Help Me Right Out of Bankruptcy?
A. Yes, as long as your bankruptcy has been discharged, we can help you. Keep in mind that depending on your situation, you may need longer than 24 months to qualify. If that is the case, we would need to set your deal up on a 36 month term.
Q. I’d like to take advantage of some of the great deals in today’s market. Can you get Me into a Foreclosed Home?
A. Unfortunately, unless you can qualify for a mortgage now, getting into a foreclosed home is rarely possible.  The reason is that most banks do not want to be landlords. While a few smaller banks will consider this option, most will not.

Q. Do You Take Section 8?A. Section 8 is ok provided that once you take occupancy you would be working towards qualifying for Section 8’s mortgage program where my understanding is they will provide financing and then subsidize the mortgage payment in the same way they are currently subsidizing your rent payment. You would need to speak to your representative there to get all of the details.

And here are some actual questions from actual prospective clients:

Q.  Do we find out and is it put in the contract what the actual purchase price of the home will be?
A.  Yes. 99% of the time there is a solidified contract price in the contract (e.g., $200,000 or whatever). .5% of the time (usually if it is a new construction home with a builder) there is an escalation or incentive clause built in where the price is X for the first 12 months and X+ for the 13th-24th months with the purpose being an incentive for you to get qualified sooner and take them out sooner. (e.g., $200,000 if the takeout is done in the first 12 months, $210,000 if the takeout is done in the 13th-24th months). And, .5% of the time, there is a pricing formula based on future valuation that is used (e.g., at the time of takeout, the price will be determined by the higher, lower or average of two fair market value appraisals, one ordered by the buyer, one ordered the seller.) There is generally also a floor put in place for the seller in the event of severe depreciation that would cause them to bring cash they don’t have to closing (e.g., if the value comes back at $150,000 and the seller owes $200,000 on their mortgage, obviously they probably don’t have the necessary funds to bring to closing to offset the difference and likely wouldn’t want to if they did). Unfortunately, no one has any way of knowing what the actual value will be at the exact moment that you are qualified for a mortgage so this is an inherent but unavoidable “risk” in any owner finance deal. Assuming the above scenario where the property does not appraise for what the seller owes or does not appraise for an agreed upon sales price as set forth in the contract, the seller has the following options:
  • They can extend out your existing contract in hopes of appreciation to meet the agreed upon purchase price or their existing lien amounts because if they cannot sell it to you for that amount because a bank won’t finance it, they cannot sell it to anyone for that amount (because a bank won’t finance it and no intelligent person with cash is going to pay above fair market value)
  • They can bring cash to closing
  • They can lower the price to match the appraised value if they have sufficient equity
  • They can do a combination of bringing cash to closing and lowering the price if they have equity
  • They can negotiate a short sale with their lender
  • They can terminate the contract. This is highly unlikely because it would require them to do one of the following: make payments on a vacant property in anticipation of getting a renter (no sane person is going to do this when there is already a paying buyer in place), make payments on a vacant property while they attempt to sell the property to someone else (no sane person is going to do this because they then run the risk of making payments on a vacant property while attempting to sell the home for an amount they cannot sell it for when they already have a ready, willing and able buyer in place who cannot close due to appraisal/pricing issues that every buyer is going to experience), move in to the property themselves (highly unlikely because they would have initially acquired the property as an investment property or they would have owned the home as a primary residence and then moved due to some other influence like a change in job location, moving up, etc. and the odds of the contract expiring at the same time as their existing housing situation is remote and again, why would they displace a paying buyer? Not likely). But, let’s assume a worst case scenario that the property doesn’t appraise and the seller is a nut and because your contract has terminated they ask you to vacate. Is that really a worst case scenario? Nope. Why not? Because at that point you are qualified for a mortgage and can go buy the same house or a similar house for a substantial discount by purchasing a short sale or foreclosure. As long as you go in with your eyes open, it is difficult to get hurt in these scenarios.
Q.  If I am understanding correctly, the homeowner selling the house enters into this program and still remains the landlard for the two years, so how am I guaranteed they will not back out of the deal?
A.  Regarding “backing out of the deal”, this is the purpose of the contract that would legally prohibit that unless you breach the contract. If you don’t breach the contract you have a legally enforceable contract that they cannot “back out of”.
Q.  How do I know they are making payments so I do not get foreclosed on? I ask this because my aunt has recently been kicked out of a house she was RTO because they took her monthly payments but never payed the mortgage and it ended up getting foreclosed on.
A.  This is a great question. Unfortunately, I get calls every day from people who are experiencing the exact same thing. This is why we instituted the policies we have to ensure that it never happens to any of our clients. In our assignment agreements with the seller, before they ever get your contract or funds from you, they agree to provide you with a copy of the mortgage statement every month indicating that the mortgage is current. If they don’t, refuse or provide one that shows the mortgage is late, we have the legal ability to accept payments going forward and have an executed borrower’s authorization that enables us to legally communicate with the seller’s lender. Without this document, the lender will not communicate with a third party not on the loan.
Q.  Do we get a monthly statement showing our accrued rental credits? Will you outline for us how much of our monthly payments go towards rental credits?
A.  If it is a lease option or lease purchase contract, yes, you will be provided in the original contract with the specific amount that is being credited towards rent credits. If it is a contract for deed, the amount credited is the amount of your down payment.
Q.  How are payments made every month, is it something we can have automatically deducted, or are we paying the seller directly?
A.  Yes, you can have the payments automatically deducted.
Q.  I’m also not very comfortable with the thought of having a landlord hanging over my head through this program. Someone showing up periodically or telling me what I can and can not do in the home I am buying, such as owning a dog or planting a tree in the front yard. How involved is the seller in this process for the next 2 years and do I have to abide by rental terms such as no painting or no pets like a traditional rental?
A.  The sellers do not want to be landlords. They want to sell. As such, the contracts are structured providing you with all of the rights of an owner as long as you make your payments on time. So, you will be free to make whatever improvements to the property that you want with the understanding that those improvements become fixtures to the property and cannot be removed if you default.
With respect to multiple dogs, there would be an additional non-refundable (credited at closing) fee required. Since you didn’t disclose the breed, I can only assume it is one that causes great concern among the uneducated (e.g., Pit Bull, Rottweiler, Akita, Chow, etc.). My last two dogs were Rottweilers so you are dealing with someone who understands the misplaced stigma associated with certain breeds. Having said that, allow me to share with you that every pet owner swears seven ways from Sunday that their dog would never do any damage to a home, which is an outright fallacy. To put this in proper perspective, I had my last Rottweiler professionally trained to the extent that he could be completely controlled on or off leash with normal obedience and protection commands with nothing other than hand signals. He was a phenomenal animal through proper training, love and care. He also weighed 140 pounds, shed, vomited, had accidents, etc., like all dogs do. So, with two dogs, there will be additional funds required to help repair any damage if you default.