Understanding Rent to Own Homes
Although there is no lack in houses for rent today, but rent to own homes are not easy to find. There are other names used for rent to own homes including lease to buy homes or lease with the opportunity to purchase homes. Since these phrases are all the same, their set up is also basically the same.
Once the rental period is over, if you have a rent to own agreement with the owner, then you can opt to purchase the house from the owner. The amount that you have paid for rental will be subtracted from the purchase price of the house, if you decide to buy it. Negotiations are usually according to the market prices, and the deal will be settled after these negotiations. But, the details are flexible and they are based on the situation of the time. There are cases when the price is decided after negotiation ever prior to the moving in of the renter. In each case, the features of the agreement can vary.
When there are rent to home agreements, these are usually very flexible. It is beneficial for renters to rent the house that they are interested in buying so that they can get hold of it at their credit. There are many renters who move in with the intent of buying the house at the end of the rental period. The renters can then actually move in a house they like with this possessions and live in it till the fixed time. They will have enough time to really know what living in that house is like before they make the final decision of purchasing the home. In this situation the renter is in great advantage.
It is not always a favorable situation for the seller. Sometimes the seller loses control of the situation because the buyer has so much flexibility and advantage. At the end of the rental period, the seller is not sure if the renter will decide to buy his hosue or not. If he doesn’t, the seller would be in a position where he might have lost prospective buyers when the house was being rented.
According to the contract, if the renter does not buy the house at the end of the rental period, he gets to keep the paid rent. Sellers consider the rent as profit for their otherwise vacant house. The chance still stands that in real estate the seller would have had the chance to sell his house for a greater profit. Gain or loss is dependent on how the seller responds to how the deal turned out.
Most real estate agents do not really deal with rent to own houses. Make sure you inform your real estate agent that your intention is to look for rent to own houses.