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By James A. Gage
If you are a renter who is tired of paying
someone else's mortgage and want to own your own home, there
are many ways to buy a real estate; one of them is Rent to
Own aka Lease Option, which is a means of acquiring
ownership over time without taking on debt.
The renter agrees to lease the home for a
pre-determined time usually from one to three years. There
may be an up-front consideration fee. The seller allows the
buyer to lock in a monthly price for the property till it is
paid off. This is a way to settle on something that is right
for you even if you are not in the position to make an
immediate purchase. A lease purchase can make your rent
money work for you instead of making your landlord rich.
Similar to a rent to own for a TV you can
have a rent to own for a piece of real estate. In this case
most sellers that are willing to do this (and there is not
many) will want a non refundable deposit on the property,
then you pay the landlord rent until you can purchase the
property. This is similar to a lease option as well, except
all you pay is rent. The deposit is much less than an option
and you do not pay the taxes or the mortgage, since you are
still a renter. The benefit of doing this is you get into
your home with the intention of buying the house at a later
date. A rent to own agreement, where the money goes directly
to the payment of the home, could be saving you a lot of
money in the long run.
This type of agreement works well with
those who are new to the housing market or have made a job
transition. It also is positive for anyone who needs to
strengthen his/her credit or pay off an obligation to
qualify for a home purchase. Another advantage to a rent to
buy situation is that if you compare how much rent money is
applied monthly to the home price, even if it is only
25-40%, it will still be much more money paid on the
principal of the house than if you had taken out a loan for
it. If you look at how much money goes to the principal
payment of a home with a typical mortgage loan, you will
find that most of your mortgage payment in the beginning is
just paying interest on the loan. The best part about this
is that with a rent to own home, you get to live in the home
you want to buy while you work on fixing your credit up.
As you can see there are a lot of benefits
to you, the buyer. In addition, here are a few more
benefits:
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A portion of your rent
payment goes towards the purchase of the property. No more
throwing away a rent payment each month.
·
Check out the
neighborhood and home before you purchase. Don’t get stuck
living next door to the Adams Family !
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Have all the benefits of
ownership now!
This creative process of how to buy a rent
to own house is becoming more and more popular because it
creates a "Win - Win" scenario. The Buyer is able to get
into a home with limited money and credit, and the Seller is
able to get a fair price for their home and get it sold more
quickly.
"You are who you are and where you are because of what you
have put into your mind."
For more information or pricing please do not hesitate to
call or e-mail. I can be reached at (508) 595-9567.
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