How does One purchase a Residence without a Mortgage Loan?

Lovely Home Must Sell No Down Payment, King Street, Toronto, ON, Canada.JPG (Photo credit: gruntzooki)

For many people living in rental homes, their goal is to be able to buy a home of their own at some point. This however remains a pipe dream because just when they think they have what it takes, something happens and the money they have saved is diverted. This of course is very frustrated and makes life hard.


It is extremely frustrating to know that you cannot get a mortgage because one has no enough money. The banks that offer the mortgages are also offering high rates such that only the financial secured people can get the advances. This then makes one desperate as they want to secure a home or their families. This is where the lease to own arrangement comes to the rescue.




It is at many times we have heard of banks refusing to offer people loans just because they do not have a down payment  rent to own. Well, the fantastic news is that with rent to own homes, there is nothing like this. In these rent homes you and the landlord agree on the same amount of money that you will be paying weekly or monthly as rent for the agreed period of time. Part of this money that you will be paying goes to the actual price of the house. It is a good way since in the end, the price of the house becomes cheaper than the initial price.



This method is both beneficial to the landlord and the person renting. When you want to go to such an agreement, it is good to have a legal representative. This is because he or she will be able to explain the terms much better and if there will be any problem they act as witnesses. When one starts living in the house, he or she is free to change whatever he does not need or rather what he does not want. In short one can change the outlook of the home. Or renovate it.



In most cases, the terms of the lease are very clear. The potential buyer will put down a down payment, usually lower than what banks require. Every month, they will pay an agreed amount as rental for the home. All the amounts are subject to discussion and agreement by both parties. At the end of the stated time, the potential buyer will then buy the property through a cash payment of a mortgage. The must therefore prepare financially in order to meet the requirements stipulated by a bank for mortgage loans.



A wise person wanting to buy a home will use the lease to their advantage and save as much as they can towards purchase. Like all agreement, there is the option to terminate and move on, which means the buyer will not buy the home. Happens is the owner gets to keep the down payment as well as the monthly rentals as stipulated in the contact. Some contracts do allow the buyer to sell off and in this way, get some money back.



Home ownership is very important and the rent to own initiative is designed to give one that opportunity to own their home. It is a safe and economical way that is been embraced widely.