Secrets You Should Know About A Rent To Own Home Deal

Which means you are fed up with renting. You wish to own your own house, but you do not need a good deal of advance payment. No doubt you’ve heard of “the perfect solution” – rent to obtain. But can it be really as perfect as everyone says – hardly. There are some secrets about rent to obtain properties you will want to find out about. They’re most overlooked areas of a rent to possess deal. So let’s understand the truth about lease to own homes.


How Rent to obtain Works

Making this how it works. You are renting a house with the replacement for buy. You will find a lease that will typically last between 2-3 years. The seller will likely require that you put some sort of upfront downpayment or option fee. Rise 1 to 7 % from the decided upon cost. As well as the rent, payable what is known as a Rent Premium or Rent Credit. This extra amounts put on the price of the property.

Let’s wait and watch what sort of Salt Lake City, Utah rent to have works out. By January, 2017 the median rent for a 3 bedroom, 2 bath house in Salt Lake City is $1,500. The actual additional amount that you’ll pay for the purchase is negotiable. Generally you are very likely to pay for 20 to 50% above the market rent. In the interests of argument, let’s go along with 25% which is about average. So you’ll pay $1,500 monthly in rent and an additional $375 towards purchase. If your lease lasts 36 months, you’ll have a rent credit from the amount of $13,500. Median home values in Salt Lake City are $280,000. Should you paid a 3% option fee of $8,400 and combined by using the rent credit, you’ll end up with a advance payment of $21,900 or 7.8%. Pretty good.

The certainty concerning rent or buy

Do you want to be aware of dirty little secret few buyers in your position realize? If you determine that you’re unable or unwilling to find the house at the conclusion of the lease agreement, you forfeit All the money that. Which includes the Rent Premium along with the option fee. Gone. The whole thing. Owner keeps the money and you also arrive at call a moving van and begin all over.

Choosing surprised how many times this occurs. The buyer may run into some difficulties with your house and they also want out. Money lost. The buyer may not be able to be eligible for a home financing. Money lost. Or, think the seller ceases to give the mortgage and the property gets foreclosed on. Yikes! Money lost.

So, prior to deciding to race to snap inside the closest rent to possess or lease option property, ensure you do your homework and also have the house inspected. Start working having a lender so that you can qualify for a home financing and for goodness sake, make sure you really like your house.
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