After Sam finished his PhD, we moved to Florida where he was set to be a professor of ocean engineering. After years of school we were excited — and flat broke. Our first place was a 3-bedroom townhouse. Not luxurious, but clearly a step-up from our college apartment dwellings.
With two children in our family — and more planned — we wanted to get settled in a real home, but the down payment required made the idea elusive. Still, we looked and hoped and dreamed about owning a home.
One day we found a three bedroom home with a zero-lot line on a culdesac in a neighborhood filled with tract homes. It needed a lot of work, but was empty and the owners were willing to deal. The offered us a one year lease option. The idea was that we would lease the home from them for a year and a portion of our monthly payments would be set aside to apply toward the down payment should we decide to go through with the purchase. Perfect! We could live in a home while saving to buy it!
A year later we exercised the option. Truthfully, it didn’t work out exactly as we had planned. Florida law didn’t allow the arrangement we had agreed upon, but still the bank was willing to work around it by using the accrued funds to make the loan possible.
While this is a great possibility, I suggest you make sure you have some sound legal advice and guidance before jumping into such an arrangement. With the greater restrictions on mortgage lending, you want to be sure that you know exactly how to manage the legal end.
Here’s hoping you can make your dream of home ownership a reality!