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Today: 22.01.2018 - 13:58:41
   Canada Mortgage Hub Discussion Board -> Mortgage Calgary -> If I enter into a private lease to own agreement how do I protect myself?
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nigal16

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If I enter into a private lease to own agreement how do I protect myself?
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Post # 1.

pseudo1999

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Hire an attorney to draw up the contract. Who makes the contract is very important. It is always more in favor of the person who makes it. Make sure all details are disclosed. You will likely lose the 25% if you are unable to perform at the end of the term. You will also want the lease contract separate from the option contract. Make sure that any maintenance responsibilities are clearly outlined as well. You would want any major issues taken care of but don't get to picky on the little stuff. Make sure everything is documented so that the mortgage company can verify and give you credit for the 25% as down payment.
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Post # 2.

nilandfam

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For $489k, you should talk with a lawyer to either write up a contract or review a contract they have written up. There are dozens of things an agreement such as this needs to consider... taxes, tax deductions, insurance on the property, what happens if you can't qualify for a loan, what happens if the value of the house drops or rises over the three years, what happens if you can not qualify for a loan, etc.Also, this sounds like a weird deal. 25% of 1800/month for 36 months is only $16,200. You'd still need a mortgage for over $473k, plus fees. By law you need 20% down in most cases. Any bank is going to want to see $94k as a down payment on that before they'll even think of giving you a mortgage. Assuming food, insurance, maintanence, rent, entertainment, power, cable, phones, etc. is only $2500/month, in order to save up $94k in 36 months, you'd need to save another $2,600/month (ignoring your loans). To make $5100 a month (after taxes and deductions) would require an annual income of over $82,000 a year.Talk with a financial planner on this one, make up a budget, etc. before getting yourself into any type of contract. Taking $16k off the price of whatever it is in three years isn't going to help you qualify for a mortgage.
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Post # 3.

piligrim80

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Check out REIN Canada. It's an investment group that invest in real estate. Log in and use forum to ask your questions. Lots of members in Calgary. Any deal like this you need to get your team together first lawyer home inspector mortgage broker etc. there is no shortcuts to protecting yourself.
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orange_420

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It is illegal to do this agreement in the US in some statesWith good reasonToo many to list on here - just too manyRent something on the cheap. And continue saving up for a down payment and time for your credit reports to recoverPlease, please don't do this home option. Save, and eventually buy something you love
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