In the previous post we discussed the idea of negotiating an extension period for your rent to own home.The article for extending your option period is discussed here.Some rent to own agreements call for a sizable fee to be paid if you choose to extend the option period. Remember that everything is negotiable and in a buyer's market you have a good chance of negotiating a reduced fee. What Amount Should I Pay? You should try to negotiate a fee of $100 or less to extend your option … [Read more...]
Do you have the option to extend your original option period with a rent to own?
When you sign a lease option or rent to own agreement you are given a certain period of time to purchase the rent to own home for a set price.What happens if you are just a few weeks or months away from qualifying for your home loan and the option period expires?Well, if you have a regular rent to own agreement setup you will simply lose the option to purchase the home and the seller is no longer obligated to sell their home to you.You will lose all the equity you have built in the … [Read more...]
Rent Credit – How Much Rent Goes Toward A Rent To Own Home?
We receive calls everyday from families who are interested in our rent to own properties.It is very uncommon to find homes where 100% of the rent goes toward the purchase price. Buyers Often Believe Every Home Offers 100% Rent Credits More commonly, we see 20-30% of rent offered as a credit, as a generous amount. But, there is no "industry standard" or normal percentage, so when you are discussing what percent of your rent goes toward your purchase, negotiate as much as you can!Also, … [Read more...]
How Much Money Will I Need To Close The Mortgage?
Rent to own homes use an agreement that usually only specifies how much money you will pay in rent each month and the amount you agree to purchase the home for within your option period.It is completely up to you as the tenant/buyer to get qualified for a home loan and come up with the funds to close on the home during the option period.The amount of money you will be required to come up with to purchase the home varies GREATLY based on the state you live in and the deal you negotiate … [Read more...]
How Much Upfront Is Fair On A Rent To Own Home?
Just yesterday, I received a call from a lady who was about to send $20,000 Western Union to a “homeowner” for a rent to own home. The seller lived in another country.Thankfully, after speaking to her, she realized the email she received was a scam and she didn't mail away her life savings.This is a true story, unfortunately. So How Much Is Fair Upfront? There really is no finite number that you could call “fair.” Our company likes to set the option fee at 3.5% of the purchase price. … [Read more...]
Don’t know how to qualify for a loan while living in your rent to own home?
You know that you are unable to qualify for a mortgage currently.This could be due to your credit score, length of time at your current job, employment status(self-employed/1099 employee), or many other reasons.The next step is to determine exactly what issues need improvement in order to qualify for a home loan. It is recommended that you make plans to speak with a mortgage specialist to help you identify what areas deserve the majority of your attention.It is NEVER to early to … [Read more...]
Paperwork doesn’t protect your interests in the property on a rent to own
Make sure the lease and option agreements state all of the agreements you have with the homeowner/seller when you are working out your rent to own home deal.It is important to have the proper lease and option agreements when setting up a rent to own deal.Often times, a tenant will sign the option documents without thoroughly reviewing them. It's not until later they find out the terms they agreed to when moving in were not actually what was included in the paperwork that was presented to … [Read more...]
