If you are looking at real estate and want to make a simpler transaction outside of a mortgage, then you can consider rent to own homes. The reputation of the rent to purchase real estate is quickly growing in popularity, both for convenience and flexibility.
How Rent To Own Works?
The rent to own process begins with finding a home that you want that has the contract set up for leasing or renting the home. You will be able to set a time frame of how long you want to rent the home for. After this time frame, you will be given the option to buy the home and to move into a mortgage agreement. Typically, you will have the choice to move into home ownership or to find a different area to lease, dependent on your needs.
Rent To Own Agreement
When you begin the rent to own process, you will be given a contract agreement by a third party. Vendors, private sellers and third party companies are the most common areas that are selling homes with rent to own alternatives. The contract specifies how much you will pay, when your contract is up and where the specified amount of money will go to, such as a down payment for the home. You will also be given alternatives for maintenance and other smaller agreements with the vendors.
Rent To Own Homes Advantages
No down payment. A problem among those who are looking for a home is that they don’t have enough money for a down payment, making the mortgage difficult to get. If you want to buy a home but are a first time home buyer or don’t have the right amount for a purchase, then the rent to own home will provide more alternatives.
Fast equity growth. When you decide to get a mortgage for your home, you will have a set contract that takes out interest rates as opposed to the principal of your home, making it take longer to buy your home. The interest rates on rent to own homes are non-existent, meaning that the money you pay either goes toward a down payment or the purchase of the home.
Profit from appreciation. The contract that you set up before moving from the rental agreement into a purchase is required to be on lock down, meaning there won’t be unexpected prices or changes with your contract. This means that you can find more alternatives to find profit while not being at the disadvantage of losing money during the closing.
No restrictions on buying. Because you are renting a home first, you don’t have to go through the lengthy process of checking credit, filing applications and re-checking your income levels. As long as you can make the monthly payment, you can get the home. This means that you don’t have to check your credit and can easily move into the rent to purchase if you have had difficulty in the past with your finances.
No taxes or liability. When you are in the rental part of the agreement, you gain more flexibility. Part of the flexibility comes with the ability to not pay taxes or to have liability on your home. For those that want to settle before looking at the extra fees, are cost cutting features that are a part of a rent to own home.
The rent to own homes advantages include several ways that you can find flexibility and new alternatives for moving into ownership. The initial agreement and contract as well as the ability to move into a mortgage with more flexibility and payment options ensures that you are able to get the right types of advantages for your home.