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How does REAL compare to a mortgage?

How does REAL compare to a mortgage?

REAL offers many of the same benefits as a mortgage. It lets you get into the home you want; own the home in the future at a fixed price; and gives you the right to sell the home and keep the difference between what is owed on it, and the sales price.

  • REAL payments are slightly higher than a typical mortgage payment, but usually less than a comparable rent payment.
  • REAL’s Acquisition-Premium payment and fees are roughly in line with what most conventional mortgage lenders require.
  • REAL is a lease. A trust buys and holds the title to the properties.
  • REAL lease payments do not create equity (although home price appreciation does).
  • REAL has different, less stringent, set of underwriting criteria.
  • If home prices decline, the most that a consumer would be responsible for is the amount of their Acquisition-Premium, not the entire underwater amount.
  • A default of the Program Agreement results in an eviction rather than a prolonged foreclosure action.
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