Real Estate Information | Let us create a 3d Digital eBook for you! DigyCat.com |
|
Lease Options or Rent to Own?
Finding a rent-to-own house is one of the many ways someone with bad or no credit can buy a house. You will often find them called names like lease/options, lease with option to buy, lease purchase, lease 2 purchase, rent with option to buy, rent to own, or rent to buy homes. There are a few differences between rent-to-own and lease-option agreements, although many people use the terms interchangeably. With a rent to own (or rent to buy) home, the buyer makes an agreement with the owner that part or all of the rent money will go towards the down payment of the home, and at a certain date, perhaps 2-5 years in the future, the renter will purchase the home, using the money that was set aside as the down payment. There is usually not much money put down in the beginning, outside of what would normally be needed for a rental home, so this is a good way to get into a home for little or no down payment. 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 25-50%, 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. 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. With a lease-with-option-to-buy, a renter signs a lease agreement (often for a shorter period of time, like1-2 years, but it could be longer). The renter/buyer usually pays a sum in cash, usually non-refundable, to the owner in agreement to buy the house at a later date for the price agreed upon. The renter has the option or right to buy the home, so in the end they have a choice and can back out it they want. Some of the rent paid may or may not go towards the purchase price of the home. This is a technique often used by real estate investors in periods when the interest rate is rising fast. This way they hope to buy the home at a lower interest rate on a later date. In the meantime, they will sublease the home to someone else, who will make the payments for them. Again, the terms "lease option" and "rent to buy" are pretty much used interchangeably today, so check with the owner to find out exactly what terms they are offering. Or approach an owner with your own offer for renting to own. If you are a renter who is tired of paying someone else's mortgage and want to own your own home, this is one of many ways that you can buy a home. One of the drawbacks is that you will still need to purchase the home at a later date. This may be a problem if you have bad credit, because you may still need to qualify for a loan when it is time to purchase the home. If your credit can be repaired in several years, this may be a great way for you to get your home now, and good motivation to clean up your credit for the future. From the book "Buying a Home When You Have Bad Credit-- 12 Ways to Purchase a House When You Can't Get a Home Loan" by Alexis Dey. © 2005 Mohave Publishing. All rights reserved. For more ideas on how to buy a house when you can't get a home loan, look for our exclusive e-book, "Buying a Home When You Have Bad Credit," which can be ordered only through our site at I-can-buy.com. For free rent to own agreements, as well as other free real estate contracts and forms to download in PDF format, check out our site at site at I-can-buy.com
MORE RESOURCES: |
RELATED ARTICLES
Be A Realtor With Curb Appeal Are you a realtor with curb appeal or are you more of a fixer-upper needful of updating?How you present yourself to colleagues, buyers and sellers, from the very first moment, will influence your sales records as well as the confidence and satisfaction your new clients feel. Even if you're a Realtor in demand, with more listings than hours in a week, you may well find areas that you can polish. Selling Houses: Cutting Edge Design Tips for Selling In this article, you're going to discover new techniques for marketing houses, and you'll find that these fresh, new interior design ideas will help sell your home faster, and for a higher price than the competition!Buyers' physical senses respond to a home's design, and what a buyer feels is based upon their psychological reactions to sight, hearing, smell, touch, and even taste. Design Psychology employs new strategies in interior design to entice buyers. Real Estate Investing Works In Your Area Too! I hope you had a spectacular weekend!Things have been going great here at Investor Wealth Academy,and we are very excited about some major developments coming down the line for us later this summer.More on that later. A Crash Course On The Payout Options Available To You When Selling A Mortgage Note Okay, let's take a look at the typical payout options:Full Purchase - The investor buys the entire note. This alleviates the seller of the responsibility to collect payments in the future. Rental Properties: 10 Ways To Increase Income What if you want better cash flow from your rental properties? You can't just raise the rents arbitrarily. If tenants leave, income goes down, not up. Flipping or Fixing Houses for Profit Many real estate investors make $5,000 to $10,000 or more by flipping houses. These investors buy a home from a distressed seller and resell it quickly for a profit. Is It Wise to Take My Home Off the Market for the Holidays? Let's say you've had your home on the market for many months without a sale. The holidays are drawing near. Build Your Retirement By Investing In Real Estate Most people buy one or two properties. One is their primary residence and sometimes they have a vacation home. Fraud in Real Estate, Are You Being Victimized? - Part II The phone range and Peter was on the other end of the line. "Willard, I have a friend of mine that has a real estate problem. 5 Hot Tips for Successful Real Estate Investment The last downturn of the global stock market saw millions of 'every day' investors having their fingers badly burned. Overnight life savings were eaten away, retirement funds went into decline and the economic forecast for all of us who had any money invested in stocks and shares was gloomy to say the very least. Real Estate Investments Real estate investments come through a variety of different options. However, whether it is a vacation property, a first home, an early retirement house, or a rental property that you find appealing, real estate investments are all the rage, and are quickly becoming one of the safest investments available, especially in our less-than-perfect economy. Real Estate Investing Requires Education I really believe in getting an education in real estate investing, especially before launching a real estate investing career. I have been investing in real estate for 25 years, but I still spend thousands of dollars each year to learn more about real estate investing. An Ideal Way to Purchase Your New Home without Strict Banking Regulations You've searched high and low around town looking for thatspecial home for you and your family. Everyone agrees that"this is the one"! Your down payment for the home is largeenough, but you know your credit is terrible, or worse,practically non-existent. At Home In Your Overseas Home Homeownership, in any form, is a big step for most people. In fact, it's often one of the biggest financial decisions of our lives. Do You Have the Correct Home Buyer Mindset to be Buying a Home? By learning what you need to know and preparing how to purchase a home ahead of time, you will be less likely to become so enamored with a particular property that you fall into the traps and the pitfalls that are so often the result of IDM, or Irrational Decision Making.Do not allow your emotions to come before sound and rational reasoning when making the decision to purchase a home. Buying Rental Property - Avoid Sellers Tricks Be careful when buying rental property. We stayed at a motel for a week one winter. Chapter One FSBO the Russ Miles thriller/mystery novel Chapter OneShe reached the phone on its second ring. "This is Tami!" She confidently answered. Investment Real Estate Made Easy - Make the Most from Each Investment Dollar When it comes to buying investment real estate, there are many schools of thought on how to get the most out of your money. Some say lease optioning your houses is the best and safest way to go. How to increase the Saleable Value of your Home When selling your home, you'll want to fetch the best price possible for your home yet it so happens in many cases, that buyers give offers that just don't meet your expectations. Of course, you will have to negotiate but you still may not end up getting how much you want. Selling Your Property Without An Estate Agent It is possible to save £1,000s selling your home privately and cutting out the estate agent, but what are the issues that you need to consider?Pricing the propertyPrice your property too low and you could short-change yourself from the true market value, price your property too high and you will simply put off potential buyers.Before you put your property on the market, you need to do some market research. |
List4Sale Domain Is For Sale - $10,000 For Enquiries eMail Us © www.List4Sale.biz 2012 |