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How do I set up a "lease to own agreement" on my home?

I am allowing some friends with less than perfect credit "lease to own" my home. However, I still have the mortgage in my name. Today my friend informed me that he would gain nothing from renting my home because we lender wouldn't allow it. All we want to do is put his name on my mortgage so he is able to improve his credit score by making payments on time every month. Do we have to re-finance in order to add his name to the mortgage? Are there any other available options open to us?

Public Comments

1. do NOT EVEN Consider doing this . u will shot urself in a body part. u can not put any one on ur mortgage. Stop this insanity. u do not help a friend this way. ur friend need s to do their own credit learning. u refi with friend , u might as well burn the house down. it will cost u the house. blow this idea off and out to sea
2. No you do not want to add him to your mortgage. The private money agreement that you speak of (lease to own) will not show on his credit because it is all private - not a public lender. The agreement only allows him to pay small amounts towards the price of the house - something he may not be able to do otherwise, if he doesn't have the discipline to save. He should try making this credit card payments and utilities on time to establish his track record.
3. Robert was a little curt and crude, but, he is right! Your friend just told you HE wouldn't gain anything. He knows he taking advantage of you, you need to see it too! Being on a mortgage with someone means when they don't pay, you will have to or you will get sued by the lender. They won't go after your friend, because he doesn't have anything. I would guess you are wanting to buy another property and need to sell this one first. Sell it to a total stranger at a loss, before you hook up with a friend who can ruin your life, financially.
4. Don't do lease to own. His credit will improve as his cancelled checks, showing they cleared your acount on time start to pile up. Rent paid on time must be shown by cancelled/cleared on time checks. BTW - Don't mention the thought of lease to own to your lender. It violates the due on sale clause of your mortgage and they have the right to forclose on you for doing it.
5. You cannot add a name to a mortgage without refinancing the entire mortgage. If he makes your payments, nothing will change in HIS credit score, since the mortgage remains in your name.
6. YOu are talking about two different things here. You cannot arbitrarily add someone to your mortgage to improve his credit score. The home will have to be refinanced with your friend's name and you essentially a co-signer. Terrible idea for someone that is credit challenged, and you are the only one with something to lose. Your credit score will be on the line, his credit is already bad, so if he screws it up, oh well. Lease to own is an entirely different deal. You have an attorney draft a lease agreement (this is not a place for shortcuts) and he leases the home for a period of time while he improves his credit. When the period of time expires, he obtains his own financing. You must have a rock solid agreement to protect your property.