[Porsche-O-Phile]

I need to correct some incorrect ASSumptions people are making above:

First off, a purchase option is not the same thing as an OWC (owner-will-carry) arrangement. In a purchase option arrangement (what we're doing), you buy the purchase option for some agreed-upon price (usually a couple of thousand bucks). You then "rent" the place for a period of time (24 months, 36 months, whatever) and your "rent" payments to the owner become your down payment IF you decide to exercise the purchase option when the date arrives. If you do NOT exercise the purchase option, the seller keeps the property, keeps your payments as rent, and keeps the money that the purchase option cost. There are clear advantages to both buyers and sellers in particular circumstances here.

In an OWC, the owner acts as the bank. They do not require you to get a mortgage and essentially you make the payments directly to them. This is riskier for the owner since a buyer who defaults can be difficult to evict/foreclose on.

In my case, I'm still responsible for getting my own mortgage at the end of this if we decide to exercise the purchase option, but I'm not terribly worried about that seeing as the down payment is a non-issue at that point (seller pays it out of the money I've been paying him) and my credit is still very good and only getting better.

As I said above - there's a lot of misinformation about these arrangements and you're foolish to simply dismiss them out of kind. There aren't a lot of good, qualified buyers out there right now and the few that are can almost always find better deals from a bank's REO/foreclosure stock than you'll be willing to stomach.

Might be worth talking to someone about.