As a real estate professional I’m most often asked to find “the hookup” for my peers. Far more than often I explain the ins-and-outs of the real estate market, they become disinterested and we play XBOX.

I want to share, with y’all, every important detail my friends dismissed with napalm fire and knife-ing.

There are two very specific types of homebuyers. Only two categories that Really Matter. Those categories are READY (Financed, Cash Buyers) and NOT READY (Renters, w/Poor Credit)

If you fall into the NOT READY category, do not fret. We have a a few options. One being to find you a nice rental to improve your status to READY and the other is alternative financing. Some Sellers (bless their hearts) want to get out of their house so bad that they are willing to buy it for you, with the consideration that you will, of course, pay them back. They essentially become the Bank of Saviour to the NOT READY homebuyer.

Most people, when searching for “the hookup” look for “rent-to-own” deals. — Applying your monthly rental payment towards the purchase of the house/condo you’re living in. What they are really looking for is one of these two types of Seller Financing.

A Lease Option – a type of contract used in both residential and commercial real estate. In a lease-option, a property owner and tenant agree that, at the end of a specified rental period for a given property, the renter has the option of purchasing the property. (this is for NOT READY buyers that become READY buyers during the term of the lease)

-or-

Land Contract – a contract between a seller and buyer of real property in which the seller provides financing to buyer to purchase the property for an agreed-upon purchase price (This varies between contracts, but usually allows time for a NOT READY to become a READY before the final installment is due.)

Now, finding these types of deals does not guarantee you will be swimming in your Beverly Hills pool this summer. You still must qualify for the house. You have to make the seller believe you are worth the risk.

Here are some steps to better your chances:

  1. Prove how serious you are about homeownership by being open and honest about your credit history. Your score is low for a reason. It looks good if you know why and can demonstrate what you have learned.
  2. Have your down payment ready. The competition for these deals is stiff. Without at least 10% in cash… Jesus be a call back from the Seller.
  3. Seek Counsel. A real estate attorney is a good source for looking at contracts and explaining all of the terms of your agreement. Have them work with your real estate agent to get you the best price and terms for your market.

Ask your REALTOR® about alternative financing.

This content is not the product of the National Association of REALTORS®, and may not reflect NAR's viewpoint or position on these topics and NAR does not verify the accuracy of the content.