The entire down payment can be in the form of a rent credit in fact.
The amount of the credit is the cumulative difference between the “Market Rent” and the “Actual Rent” paid.
For example, if the market rent for a property is $2,000 and the renter pays $3,000 instead for a full year (as per her rent/purchase agreement), she would have 12 payments of $1,000 (or $12,000) to apply to her down payment.
This works for all conforming loans, FHA loans and many jumbo loans.
The required documentation includes:
- A rental/purchase agreement, that clearly sets out the terms of the lease.
- Copies of canceled rent checks to prove rent payments were made for the last 12 months.
- A market rent estimate from a qualified appraiser.
Jay Voorhees
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 1197176, NMLS# 310167
