Since you will be putting 3k down. Kidding, i know it is for all intensive purposes.
You hint at it, but how much of the rental pmt is applied to principle on the proposed lease option?
Most courts will view a lease-option with principle credits as an installment sale, so I would pick the option that is the best deal for you as it will basically be the same deal. Most investors will tell you to get the deed.
I don’t really see this as a killer deal. It is nice to get close to 100% financing, but it looks like you are paying close to retail. There are so many deals out there that I would recommend you keep looking.
I am purchasing a duplex for investment purpose (I will not be living in this duplex). The owner has agreed to either lease with option to purchase or finance 100% (most likely with 7% interest) with a balloon payment for this property. Here are the details:
Purchase price: 143700
total rents: 1475
Down payment: 3000
Interest rate: 7% (I might offer 4% 1st year and 5% 2nd year and then 7% for the remainder 2 years)
Purchase within 4 years.
I always thought 100% seller financing is better because the money I pay will directly go into the mortgage. In case of lease option only a few points go into the mortgage and I will be left with bigger payment when I buy in this 4 years.