Monday, June 29, 2009

What is a lease to own?

What Is a Lease-to-Own Purchase?

A lease-to-own house purchase (also "rent-to-own purchase" or "lease purchase") is a lease combined with an option to purchase the property within a specified period, usually 1-2 years, at an agreed-upon price. Upfront, the borrower will pay an option fee, 1% to 5% of the price, which is credited to the purchase price. The borrower pays rent and an additional rent premium that is also credited to the purchase price. If the buyer decides not to purchase, then the buyer loses both the option fee and the rent premium.

Contract Features of a Lease-Purchase:

The sale price of the house and the rent are market-determined, yet subject to negotiation just as in a straight purchase or rental transaction.

To the buyer, the option and rent premium are part of the equity in the house they will soon own. If they buy, the only cost is the interest they would have earned. To the seller, these payments are the best guarantee that the buyer will exercise their option to buy after the lease agreement is completed. If they do not go forward with the purchase, these payments are retained as income. In the lease interim, the seller still gets the tax benefits of home ownership.

A lease purchase also may give the renter/buyer the right to assign the option to buy. This will usually have considerable value to the buyer, because it means that the option can be sold in the event that it has value but the buyer is not able to exercise it. It is a cost to the seller for the same reason.

Monday, June 15, 2009

New construction tax credit running out!!

I read this morning an interesting article (link below) from CNNMoney.Com. The state set aside $100 million to help home buyers purchasing newly built homes and about 20%of the pot is left. According to the State Franchise Tax Board, the program launched in March and by June 3 nearly $24 million in tax credit certificates had already been issued. That leaves nearly $76 million in credit available - but there are already numerous claims on that money. In fact, if all the submitted applications are approved, only $17.5 million will be left in the fund. And it has a run rate of about $10 million per week. And here is the kicker - in order to get the $10K credit, you have to close the deal BEFORE the money runs out. Most people believe it's just getting the offer accepted - not the case!

Here is the link to the story:

Tuesday, June 09, 2009

June is here and farmer's markets are back!

I love June because I know that most farmer's markets in the East Bay are starting back up! Shop at a farmer's market - support your community and local farmers!!


Grand Lake farmer's market(FM):
Every Saturday 9am-2pm; Located across from Grand Lake Theater

Montclair Village FM:
Every Sunday 9am-1pm; Located at La Salle Ave/Moraga Ave

Laurel District FM:
Every Saturday 10am-2pm; Located at 4173 Macarthur Blvd

Old Oakland FM:
Every Friday 8am-2pm; Located at 9th/Washington

West Oakland FM:
Every Saturday 10am-4pm; Located at 5th/Mandela Pkwy


Saturday 10am-3pm; Located at Center/Martin Luther King Jr.
Tuesday 2pm-7pm; Located at Derby St/Martin Luther King Jr.
Thursday 3pm-7pm; Located at Shattuck Ave/Rose St (All Organic)