Rent To Own Homes Explained
Lease Option BuyWhile there are a lot of resources available for you to learn about rent to own homes, we have sifted through and have chosen the most useful information available. We hope you enjoy this article about Rent To Own Homes and Selling With Lease-Options
The biggest real estate trend right now for the Great Lakes state is lease to own homes in .....
If you desire to own your own home but are unable to secure conventional financing today, leasing a home with an option to buy may be your best option. A lease purchase can make your rent money work for you instead of making your landlord rich. Typically rent to own homes offer rent credits that reduce the final purchase price!
Heres how it works:
A home is made available via a standard lease with one important addition. Included is an option to purchase that home at a specified price over a specified time period (usually one or two years). In order to acquire that option, the renter/buyer must pay a one time, NON REFUNDABLE, fee called the option consideration. The exact amount is negotiable, but it is usually ranges from 2.5 to 7% of the purchase price. A fair contract will credit the buyer 100% of that option consideration upon closing of the sale. Furthermore a negotiated percentage of all rent payments should be applied toward the purchase price of the home. Some typical terms and conditions one might expect to find in a contract follows:
Lease With Option
The housing market has exploded, with home prices rising beyond all reason in some markets. Home prices have doubled .....
1. In order to receive a rent credit of 50%, time is of the essence. You MUST pay your rent on or BEFORE the due date of your lease (typically the 1st of the month). This means it must be received by the lessor (landlord) on or before the due date. Any payment received after the due date will result in a 0% rent credit for that month, a late fee may apply and you will not be building any equity.
2. Maintenance is the responsibility of the Tenant Buyer. You are now renting to own and homeownership requires maintenance. This includes things like broken windows from stones or baseballs, clogged drains, peeling paint, broken appliances, burnt out bulbs, lawn work/snow removal, etc. If any major repairs are required to ensure habitability, the owner remains responsible.
Wilmington Rent To Own Homes3. You need to have Option Consideration. Option Consideration is typically 2.5% to 7% of the purchase price of the home. It is a non-refundable payment, of which 100% is credited toward the purchase price, which binds the lease purchase contract.
Wilmington rent to own homes and the power of the lease purchase for Wilmington home buyers.
One of the main attractions of rent to own in a .....
With the amount of information freely available on the web concerning rent to own homes and lease and purchase option, we have undertaken the task of choosing only the highest quality sources. By doing this, we hope to supply readers such as yourself with up-to-date rent to own homes information, as well as enabling you to learn more about related things like Lease Agreement.
Heres an example transaction:
We have a nice 3 bedroom, 1 bath single family home located in a near west suburb of Chicago in a great neighborhood with good schools and a strong community. It has been freshly painted, cleaned, and is ready to move in. The purchase price will be $215,000. Monthly rent payments will be $1,500 and you will receive a 50% rent credit ($750 per month). You need between 2.5% and 7% in up front Option Consideration. Lets say your budget allows for $6,000 for Option Consideration. This equates to approximately 2.8% ($6,000/215,000). You will also need $1,500 for the first months rent for a total initial payment of $7,500.
Please note: Option consideration is not a security deposit. It is a non refundable payment toward the purchase price and is 100% credited toward reducing the price of the home.
Now suppose you paid all your monthly rent payments on or before the due date and you choose to buy the rent to own home at the end of the 12 month lease purchase contract. You will have $15,000 in equity before you even own the home! Heres the math:
Lease Purchase Price - $215,000
Lease Option Charlotte
Lease purchase provides a first step to perspective home buyers in Charlotte
First off lease purchase is sales .....
Less: Option Consideration paid at lease signing - $6,000
Less: 50% rent credit of $750/m * 12 months - $9,000
Lease Option To Buy HomeNet Purchase Price after credits - $200,000
Lease options to buy home programs are becoming increasing popular with those that have bad credit problems and can not normally qualify for a .....
You started with $6,000 and by paying your rent on time; your equity position grew 150% (another $9,000) for a total of $15,000 with 12 months. Not a bad deal! Many people find it nearly impossible to save $9,000 in a year with all the costs of living constantly on the rise.
Whats the catch?
Now you may be thinking, 'OK, whats the catch? This sounds too good to be true.'
Answer, there is no catch.
There are many possible reasons a landlord/seller may want to enter into a rent to own agreement. Some reasons may be:
1. Needs to maintain ownership for at least one year for tax purposes.
2. Unable to get a fair price due to local conditions.
3. Tired of performing minor maintenance.
Lease Option PurchaseFurthermore, when one sells a home through a realty service, a commission of 5-7% is typically paid. In the example above, this can cost more than the rent credit. Since realtors are usually not involved with this type of transaction, there is no commission and the landlord can afford to pass along the savings to tenant/buyer in the form of rent credits.
The traditional method of buying a home is putting 20% down, after qualifying for a mortgage from a reputable .....
Also, when the Tenant becomes the Tenant Buyer (via rent to own), there is an immediate sense of pride in ownership. Tenant Buyers add value to the community. They take care of their future property, make improvements, and feel good knowing their rent money is working for them (reducing the purchase price) rather than just making their Landlord rich.
There are also many advantages for the renter. Some are:
1. Build equity toward home ownership.
2. No bank or finance company involvement.
3. Poor credit history may not be an issue.
Bob Pappas is an associate of JSC Rent To Own Homes, a unit of JSC Investments LLC. Bob acts as an investing third party in certain situations where either a renter would like to purchase a new house or the house he/she is currently renting, or a seller wishes to sell his/her property through a lease purchase agreement. For more information, visit http://www.jscinvestments.com/
Rent To Own Houses
So what is Rent To Own really all about? The following report includes some fascinating information about Rent To Own--info .....
We invite you to investigate some of the other pages on our website to learn even more about rent to own homes. You might also be interested in learning more about Lease With Option To Buy. Thanks for stopping by.
(c) Rent2own-HouseFinder.com 2006 -Author List - Sitemap - Atlanta • Boston • Chicago • Cleveland • Dallas/Ft. Worth • Denver • Detroit • Houston • Las Vegas • Los Angeles • Miami • Minneapolis/St. Paul • New York City • Orlando • Philadelphia • Phoenix • San Diego • San Francisco • Seattle • Washington, D.C.
© Rent2own-Housefinder.com 2007 | All Rights Reserved | Links | Sitemap | Rent-to-Own Houses