Do you arrange owner financing for the homes you sell?
Our predominant avenue of presenting a path to successful homeownership
is through Rent with an Option to Buy.
Do I need to qualify to buy a home?
During a 2 year Option to Buy period, you have that time to clean up your
credit and save up enough money for closing costs so
that you may qualify for a loan most likely from an institutional lender.
Some lenders require a 620 to 640 or higher credit score. so it is recommended that
you work with a professional who is adept at helping you clean up your credit report.
Also some lenders require at least 3 trade lines, so you may need to establish
new credit lines.
How can I buy a home when I have bad credit?
You can't through conventional lenders, but for the option period allows some people the time they
need to clean up their credit report and establish an admirable payment history
to help improve their credit within the option period.
How much down payment do I need?
That depends on the lender. The option consideration should count for the down
payment with most lenders.
The more you put down in the form of option consideration, the easier it is for you
to get financed later on. The minimum option consideration that we accept is 5%.
If you are renting the property, the option consideration is an amount
that you would need to put down along with the security deposit and the first month's rent.
Here are some Loan Types with Typical Down Payments required:
| Loan Type |
Typical Down Payment |
| Conventional Loan |
3%-20% of the home price |
| FHA Loan (Federal Housing Admin) |
3.5% (with a credit score > or = 580) |
| VA Loan (for veterans) |
0% (no down payment required) |
| USDA Loan (rural areas) |
0% (no down payment required) |
Do you offer down payment assistance programs?
No. If you need down payment assistance, you probably would not be qualified
to obtain bank financing before the end of the option period.
How does your Rent with an Option to Buy Program Work?
We can rent you the home with the exclusive right to purchase it at a later
date within the Option period.
Buyers love this because it gives them the time they need to save up
if they need a larger down payment, time to clean up past credit problems, time to
sell another home, and also time to try out the neighborhood before buying.
100% of the option fee is credited towards the down payment and the
purchase price of the home if the optionee goes through with the purchase.
Option Fees
An option fee is a non-refundable fee paid to the optionor seller by the optionee buyer.
The optionor is being compensated for their time as they can collect but cannot accept additional offers
during this period. The optionee is allowed to do their due diligence and inspect throughout the option period.
If the optionee changes their mind about the property, they do not have to exercise their option but they
will not get their option fee back.
By using an option fee, the optionee can determine if they want to proceed with their planned purchase
without the stress of other offers being accepted and with no damage to their credit report
if they do not move forward, but have made their rent payments on time.
Earnest Money
Earnest Money is NOT REQUIRED in our Rent with an Option to Buy program.
Unlike traditional home purchases, in our Rent with an Option to Buy program,
earnest money is not required, but a non-refundable option fee is.
So, while earnest money isn't usually part of a rent with an option to buy, the option fee
serves a similar purpose—showing good faith and securing the right to buy.
I want to see some 'rent-to-own' homes,
what is the next step?
PreQualify
Click Here to PREQUALIFY
for a Rental with an Option to Buy!
FHA Changes In Qualifying for a Home Loan
FHA and Qualifying for a Home Loan as of January 20, 2010
FHA changing policy on credit score, own payment
By Mary Ellen Podmolik
January 20, 2010
The Federal Housing Administration announced changes Wednesday that will make
it more expensive for homebuyers to secure agency-backed mortgages while some
consumers will be priced out of the housing market.
The proposals, intended to shore up the agency’s loan portfolio, formalize a
multipronged strategy it outlined last month and are designed to protect both
homeowners from obtaining unaffordable loans and the agency from dealing with
the resulting losses from bad mortgages.
“Homeownership is important to the sustainability of communities,”
FHA Commissioner David Stevens said in a conference call with reporters.
“But we’ve also learned that not everybody should own a home. Putting
responsible guidelines in place is a way to insure sustainability for homeowners.”
Stevens said the agency was mindful that it didn’t want to overly disrupt the
housing finance market and the mission of the FHA to serve first-time homebuyers.
Last year, the FHAbacked 1.9 million mortgages, compared with 1.1 million loans
in 2008. FHA-backed mortgages for new home purchases and refinancing now
constitute 30 percent of the total housing finance system, and 50 percent
of first-time buyers go through the FHA.
To be able to make a down payment of just 3.5 percent on an FHA-insured loan,
homebuyers would have to have a minimum FICO credit score of 580, rather than
the current 500 FICO outlined in FHA guidelines.
New borrowers with less than a 580 score would have to put down 10 percent
on a home purchase.
However, that change is unlikely to affect many homebuyers because most
participating lenders require borrowers to have a score of 620 or higher.
Some legislators had called for all FHA-backed mortgages to require a 10
percent down payment.
Stevens acknowledged the stricter origination criteria of most lenders in
2009 and said in determining the new minimum credit score, the agency looked
at mortgage performance records of the past several years, including when
mortgages were much easier to obtain.
The FHA also will increase the upfront mortgage insurance premium to 2.25
percent of the total loan amount, from 1.75 percent.
The agency also will ask Congress for permission to boost the maximum annual
mortgage insurance premium it can charge.
If that authority is granted, some of the premium increase would be shifted
from the upfront premium to an annual one.
As disclosed last month, the FHA also said that sellers would be able to pay
closing costs of up to only 3 percent of a home’s sales price, rather than
the current 6 percent.
Stevens also outlined several steps to increase enforcement of FHA lenders,
including plans to publicly report lender performance rankings. The policy
changes are aimed at the small minority of “rogue performers,” FHA-approved
lenders who the agency believes operate outside its rules, he said.
The increased upfront mortgage-insurance requirement will take effect in the
spring. The new FICO score requirement and the change in seller-contributed
closing costs will take effect in early summer, the agency said.
FHA Changes In Qualifying for a Home Loan as of May 25, 2025
As of May 25, 2025, the Federal Housing Administration (FHA) has implemented significant changes to its home loan eligibility requirements, particularly affecting residency status. Here's a breakdown of the key updates:
Major Change: Non-Permanent Residents No Longer Eligible
- Who is affected?
Non-permanent residents, including those with valid work visas or under programs like DACA, are no longer eligible for FHA-insured mortgages.
- Why the change?
HUD cited concerns about the long-term financial risk of lending to individuals whose legal status may change, potentially affecting their ability to repay the loan.
Who Remains Eligible?
- U.S. Citizens
- Lawful Permanent Residents (Green Card holders)
These borrowers must now:
- Provide proof of permanent resident status from USCIS
- Be listed as permanent residents on the Uniform Residential Loan Application (URLA)
- Special Exceptions:
Citizens of the Federated States of Micronesia, Republic of the Marshall Islands, and Republic of Palau remain eligible under the Compact of Free Association agreements.
Effective Date
- Applies to FHA case numbers assigned on or after May 25, 2025
- Existing borrowers and applications submitted before this date are not affected
Impact on Homebuyers
- This change could significantly affect first-time homebuyers, especially in industries with a high number of skilled immigrant workers (e.g., healthcare, tech, education).
- FHA loans are popular for their low down payment and flexible credit requirements, so losing access may limit options for many non-citizen buyers.
To qualify for an FHA (Federal Housing Administration) home loan in 2025
You'll need to meet several key requirements.
These loans are designed to make homeownership more accessible, especially for first-time buyers or those with
less-than-perfect credit.
Basic FHA Loan Requirements
| Requirement | Details
| Credit Score | Minimum 580 for 3.5% down payment; 500–579 requires 10% down
| Down Payment | 3.5% if credit score = 580; 10% if score is 500–579
| Primary Residence | Must be your main home; not for investment or vacation use
| Appraisal | Home must be appraised by an FHA-approved appraiser
| Inspection | Property must meet FHA’s minimum safety and livability standards
| Debt-to-Income Ratio | Typically up to 43%, but some lenders allow up to 50%
| Occupancy | You must move in within 60 days of closing
| Mortgage Insurance | Required upfront (1.75%) and annually (0.55% or more)
| Loan Limits | Varies by county; higher in expensive areas
Additional Notes
- Gifted Down Payments: Your down payment can be gifted by a relative, employer, or nonprofit.
- No Income Limits: Unlike some programs, FHA loans don’t have income caps.
- Past Credit Issues: You may still qualify even with bankruptcies or foreclosures, depending on how long ago they occurred.
To qualify for a USDA loan in 2025
You’ll need to meet several key requirements related to income, location, and credit.
Here’s a breakdown of the main qualifications:
Property Eligibility
- Location: The home must be in a USDA-designated rural area. You can check eligibility
using the USDA Property Eligibility Map.
- Occupancy: The property must be your primary residence (no investment or vacation homes).
- Condition: The home must meet USDA standards for safety and livability.
Income Requirements
- Income Limits: Your household income must not exceed 115% of the median income for
your area. These limits vary by location and household size. You can check your
county’s limits using this lookup tool.
- Stable Income: You must demonstrate a stable and dependable income, typically
for at least 24 months.
Credit and Financial Qualifications
- Credit Score: While the USDA doesn’t set a minimum score, most lenders prefer
a score of at least 640 for streamlined processing.
- Debt-to-Income Ratio (DTI): Generally, your DTI should not exceed 41%, though
exceptions can be made with strong compensating factors.
- No Recent Bankruptcies or Foreclosures: You’ll need to show a clean financial
history for the past few years.
