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Frequently Asked Questions
1. How long does the process take?
As a general rule, new client should plan for a 60 day process to:
2. What do I have to do in the process?
Your job is to go shopping with our real estate agent and find that house that suits your needs in
terms of size and location.
3. Do I need a down payment?
Yes, Your investor will require a fee equal to 2% of the price of the home BEFORE you take
possession.
4. How is the monthly payment determined?
Your monthly payment is determined by multiplying the cost of your home by .008. The cost of
home ownership is approximately $8.00 per thousand. This number has only varied within a
small range since the 1960's. It has been as high as $10.00 and as low as $6.50. The current
average of $8.00 is about in the middle range for the past 50 years.
For example a $200,000 home times $8.00 yields a monthly payment of $1,600.00 per month.
In addition to the $8.00 per thousand, you will be responsible for the monthly Home Owners
Association Fee when applicable.
5. How do I know how much house I can afford to purchase?
We will work with you and based on your Gross Monthly Salary, we will mutually decide what
you can afford to pay for your rent. Our general rule of thumb is your Gross Monthly Income / 3
Remember, this is the maximum payment we would feel comfortable with. That doesn't mean you
have to spend that much, the home choice is yours as always. CLICK HERE TO SEE HOW
MUCH HOME YOU CAN AFFORD!
6. How long of lease/option contract do I have to sign?
Our standard lease/option agreement is for a term of 24 months. In our unique program, you will
have the entire 24 month period to “exercise” your option to purchase your home at the agreed
upon “option price”. Keep in mind that this contract is an 24 month “OPTION” which means,
you have the option to exercise your rights any time up to 24 months. We have found that on
average our clients exercise their option before the 24 month period.
7. How is the “Option Price” determined?
When we purchase your home for you, we will determine what the “Acquisition Price” of your
home is. The acquisition price is the sales price PLUS any fees that are not included in the sales
price. Your “option price” is simply the “acquisition price” plus 10%. For example on the
$200,000 home, you option price would be $220,000. We limit our investors to 10% over two
years. (5% per year)
8. Why would I exercise the option before 24 months?
Good things happen for you when you exercise your option. The best thing is that all the tax
benefits of home ownership flow to you, meaning you can deduct all taxes and interest on
Schedule A of your 1040 personal tax return.
9. Why is your program different from other lease/option programs?
The main difference in our program is that our goal is to see that you are successful in your
endeavor to become a home owner. This is accomplished in two important ways.
As a general rule, new client should plan for a 60 day process to:
- Find your new home and get it under contract.
- Do the necessary inspections and appraisals to make sure the property is as advertised.
- Obtain financing for your “investor”.
2. What do I have to do in the process?
Your job is to go shopping with our real estate agent and find that house that suits your needs in
terms of size and location.
3. Do I need a down payment?
Yes, Your investor will require a fee equal to 2% of the price of the home BEFORE you take
possession.
- $1,000.00 pre-payment refundable deposit to retain our services to purchase your new home.
- 1st Month rent on your new home. (This is payable 1 week before the contract close of
escrow date) - Option Fee to investor of 2% of home price
4. How is the monthly payment determined?
Your monthly payment is determined by multiplying the cost of your home by .008. The cost of
home ownership is approximately $8.00 per thousand. This number has only varied within a
small range since the 1960's. It has been as high as $10.00 and as low as $6.50. The current
average of $8.00 is about in the middle range for the past 50 years.
For example a $200,000 home times $8.00 yields a monthly payment of $1,600.00 per month.
In addition to the $8.00 per thousand, you will be responsible for the monthly Home Owners
Association Fee when applicable.
5. How do I know how much house I can afford to purchase?
We will work with you and based on your Gross Monthly Salary, we will mutually decide what
you can afford to pay for your rent. Our general rule of thumb is your Gross Monthly Income / 3
Remember, this is the maximum payment we would feel comfortable with. That doesn't mean you
have to spend that much, the home choice is yours as always. CLICK HERE TO SEE HOW
MUCH HOME YOU CAN AFFORD!
6. How long of lease/option contract do I have to sign?
Our standard lease/option agreement is for a term of 24 months. In our unique program, you will
have the entire 24 month period to “exercise” your option to purchase your home at the agreed
upon “option price”. Keep in mind that this contract is an 24 month “OPTION” which means,
you have the option to exercise your rights any time up to 24 months. We have found that on
average our clients exercise their option before the 24 month period.
7. How is the “Option Price” determined?
When we purchase your home for you, we will determine what the “Acquisition Price” of your
home is. The acquisition price is the sales price PLUS any fees that are not included in the sales
price. Your “option price” is simply the “acquisition price” plus 10%. For example on the
$200,000 home, you option price would be $220,000. We limit our investors to 10% over two
years. (5% per year)
8. Why would I exercise the option before 24 months?
Good things happen for you when you exercise your option. The best thing is that all the tax
benefits of home ownership flow to you, meaning you can deduct all taxes and interest on
Schedule A of your 1040 personal tax return.
9. Why is your program different from other lease/option programs?
The main difference in our program is that our goal is to see that you are successful in your
endeavor to become a home owner. This is accomplished in two important ways.
- We work with you while you are still a tenant to do everything legally possible to clean up
your credit score and move it higher. - We put you in a great position to make some money on your home even before you are the
owner.
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