Need some help analyzing my first potential deal.

[Dan Crenshaw]

I came across a renter that has currently been living in a 3br ranch for the last 2 years. He loves the house and would love to own instead of rent. He doesn't have the down payment to purchase it, and has mediocre credit, so it's tough for him to get a reasonable loan.

From what I am told, the house needs some repairs, but nothing too serious (mostly cosmetic). It seems as though the landlord is somewhat motivated to unload it as opposed to fix and keep it. It is in a desirable area and feel this could be a very good deal.

I was wondering if purchasing this at a discount and leasing with an option to buy to the renter would be a good idea. This would be my first deal, and honestly it seems a little overwhelming. Anyone who can help me get going in the right direction would be a HUGE help. Thanks in advance!

[Dan Crenshaw]

@Joel Owens, I would NEVER condone anyone to do anything illegal, and I was unclear about the differences of an investor loan and a conventional homeowners loan. So thank you for clarifying that for me. (As I said, this would be my first lease option)

@Prashant P., I completely understand that doing my homework on tenants is a very important part of the process, and I can assure you I will not cut corners on that. Thanks for the heads up! And I'll be sure to have the property thoroughly inspected before I pull the trigger.