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Summary of 1st Priority Realty, Inc.’s
“Lease- Purchase” program for the client-buyer
We first determine the client’s situation and status by gathering several types of information so we can help them find the right home for their family. The information we need is their present employment and income, their credit history and event(s) that may have been a factor in a credit problem, and what price, size, and location of the home they are looking for.
We then use our staff to review that information to see what price range home they are qualified for and the area they want to live in, and the date they prefer to move their family into the new home we help them find. We search the new home builders for the best homes with the best discounted pricing on their “finished inventory” homes, as we only purchase new homes for our clients with major builders in good communities which protects the client’s interests as well as our investors’.
Once we find the best home that the clients want and meets their financial needs, we purchase the home with our investor group. We then lease the home to the clients for a year and then sell the home back to them at a pre-determined price in writing . We pay for the client’s entrance fee into a credit restoration service we have made special discounted rates with, so the client only pays $49 / month until their credit is improved to the point that they could be approved for a good home loan.
We lease the home to the clients at approximately 1% of our purchase price / month, or, if a $150,000 price, then a $1,500 / month lease rate. With the combination of the credit of the option deposit (usually one month’s rent) and rent credits, the client’s net price of the home at the 12 month purchase is approximately 107.5% of the initial purchase price to the investor. An example would be a $150,000 purchase price to the investor, would be $150,000 x 107.5% = $161,250 purchase price to the client in 12 months.
Some advantages to the client with our “lease-purchase” program are:
*Selecting the new home they want, with warranties, in the area and price range they need, at a great discounted price.
*Having an “experienced financial and real estate team” advise them on affordability, location, builder, house plan, resale appreciation, credit counseling, and loan acquisition, all for a commission paid by the new home builder, at no cost to them.
*Minimum cash out of pocket to get a new home; only the rent and one month’s rent as option deposit to move in, vs. usually 5% to 10% needed conventionally.
*Frequently no down payment needed at close of the new home at the 12 month option purchase; because the “low option purchase price” we offer allows the appreciation on the home to give the client “equity” in the home right away for loan purposes.
*Credit problems are OK and credit repair can be done effectively reducing the client’s loan interest rate, and increasing their credit rating and ability to purchase .We help pay for your credit repair and have arranged a low monthly cost to you.
*Possible extra “appreciation” of the home over the pre-agreed price to the client, resulting in a potential profit in the home for the client.
*Quick move-in to a finished new home without lengthy pre-approval process by typical lenders.
*Convenience of not moving twice at the 12 month purchase time, and being established in the neighborhood you want.
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