A growing number of individuals are becoming more interested in acquiring rent to own houses.
Apart from being the most practical way to easily buy a house, it does not really entail you to shell out a big sum of money but rather, gives you time to pay in small amounts. For potential buyers and sellers of rent to own houses, here are the basic things or possible scenarios you might encounter.
- Confusion with the terms “rent to own” and “lease purchase”
This is quite tricky especially for those who are not technically inclined about real estate properties. Both terms generally revolve around the same idea. But, a rent to own property is something that you will have to pay for rental fee over a certain period and yet, you are not required by any law or contract to pay for the whole value of the property. You can be a tenant but at the end of the rental contract, you do not have any legal obligations to purchase the property. On the other hand, lease purchase is when you are renting the house for a number of years and agreed to acquire the property at the end of the contract. With this type of agreement, you are obliged to stick with the agreement that you will pay for the remaining amount that will sum up to the total value of the property.
- It is not necessary to seek the help of a real estate broker.
Some rent to own property owners are worried that they will have difficulty selling the house more so, in finding a tenant. You do not need to be a real estate broker nor seek help of an outsourcing party to sell the property. You do not have to be a marketing or sales expert just to be able to close the deal on a rent to own house. It actually depends on how much you want to sell of the property. Posters that friends can give away, asking permission from commercial establishments to place fliers, posting a “for sale” sign on the front door, and of course, social media are just some simple but effective techniques in order to easily recruit a buyer for your property. Other legal terms or contracts can be directly consulted to a lawyer who can eventually take care of the other documents needed for the deal. In this way, you save money from the commission that you will give to the real estate broker and instead have the sales income just to yourself — no third-party seller needed.
- It is important to take note of the monthly rental fee, down payment and other fees.
Normally, owners of the rent to own house would require you to pay 2% to 5% “option fee”. This is separate payment for the rental fee and the rest of the amount you have to pay in order to acquire the property. Nevertheless, it is still a better and cheaper deal compared to getting a brand new house and lot. With this kind of payment terms, you do not have to worry about the thousands of dollars to buy a whole house and lot but instead, rent to own houses will make you feel paying for something which in the long run will become your own.
- Think of the rent to own house as your own home.
Both seller and buyers have a different perspective. But, if you will look at the whole picture, the property will be yours any way. So, treat the house as your own. It would be best if you have an agreement with the seller about repairs and other house matters that you would like to do. After all, you will be the occupants of the house for a long time and eventually make it your own home.
- Do a little research around the community
If you have finally decided on buying a rent to own home, make your own little research on the market value of the property that you are going to occupy and eventually acquire. This will help you make a good deal with the seller of the house.
- Beware of the unpaid mortgages.
Before signing into any contract, make sure that the owners are cleared of their obligations to pay the mortgages or property tax. There are double crossers who would sell off the property simply because they are unable to consistently pay the necessary taxes. If this is the case, you can bargain for an arrangement where you will not end up paying for unpaid amount aside from the total value of the rent to own house.
- Where to start looking for rent to own house.
There are many listings of rent to own houses over the Internet. It is actually the fastest and easiest way to search. You do not necessarily have to consult or meet with real estate agent when you can just do it on your own with just a few clicks on your computer.
Getting into a rent to own contract can be very tricky. So, if you do not want to end up losing a big amount of money, better ask questions or seek legal advice of experts or perhaps persons who have gone into the same experience. It could be the most practical way to acquire a property.
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