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Rent to own homes are homes where a buyer is allowed to rent a home for a specified amount of time, with the option of purchasing the home within that specified time frame. The purchase price, along with the contract length, is also negotiated before the lease begins. If for whatever reason the buyer decides not to buy the home, the property and any rent credits accumulated go back to the seller.
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From a seller's perspective, rent to own homes are a great option to sell their home because the demand for them is often very high. The seller is offering a unique opportunity to the buyer that the buyer is hard pressed to find elsewhere. The seller does not have much to lose. If the buyer decides that he or she is not interested in the home at the end of the leasing [url=http://www.chinapccd.net/bbs/ShowPost.asp?ThreadID=58888]moncler outlet Gucci Techno Horsebit Bright White[/url] [url=http://www.maximoupgrade.com/hot.php]hollister france[/url] period then the seller will get the home back and most likely will [url=http://www.1855sacramento.com/woolrich.php]woolrich outlet[/url] have profited monthly from the payments the buyer had been making. Depending on the housing market the home is located in, it is common for the expenses of the home to be less than the rent charged for the home. This includes debt payment (mortgage), property taxes, maintenance, insurance, etc. Housing prices have of course historically risen. If the seller does get the home back they can actually profit more. They will profit from selling the [url=http://www.gotprintsigns.com/monclerpascher/]moncler[/url] home for a higher price than originally negotiated. Or when they do another rent to own sales agreement and collect the upfront option payment. If the buyer decides to follow through and buy the home the seller also wins.
Let's take a moment and discuss how rent to own homes actually work. We'll break it down into a few key steps:
Step 1: Agreement on Purchase Price - Both the buyer and seller will need to come up with a final price they agree on. These terms are final and will rarely be changed once the lease begins.
Step 2: Locking Out Other Buyers - The buyer will pay something called an "Option Fee". This amount is also negotiable [url=http://www.chaoju.info/home.php?mod=spacecp&ac=blog&blogid=]woolrich outlet What Can a Plastic Shed Do To Your[/url] and gives the buyer [url=http://www.mansmanifesto.fr]doudoune moncler[/url] the option to purchase the home at a later time. This fee will also prevent the seller from renting or selling the property to someone else.
Step 3: Tenant Occupies Home - Once a final price is agreed upon, and all fees are paid and it is time for the tenant to move in. Rent to own homes are often rented for up to three years which gives the buyer a substantial amount of time to get traditional financing and fulfill the terms of the agreement.
A portion of each month's rent will go towards a "credit" that will eventually be applied towards the purchase price of the home. Should the buyer decide not to buy, all of that credit will simply stay with the seller and not be returned to the buyer. So the buyer has a strong financial incentive to follow through. They stand to lose thousands of dollars by not making the [url=http://www.achbanker.com/home.php]hollister france[/url] purchase.
One reason why rent to own homes are so popular is because they provide a lot of benefits for both buyers and sellers. For example, the buyer's credit [url=http://www.davidhabchy.com]barbour outlet[/url] will often be less of a deciding factor in qualifying for the purchase. Plus, their down payment may be smaller depending on what the seller will be charging up front as an option fee versus what they would need with traditional financing.
Sellers benefit because they are earning monthly cash flow with the intent of making a final sale once the lease ends. And the good news is that since most buyers are only interested [url=http://www.e0594.com/forum.php?mod=viewthread&tid=118797]barbour outlet Water Damage Restoration - Why To Avoid DIY Restoration[/url] in purchasing the property to live in, the seller can feel at ease knowing that the property is going to be taken care of very well. The buyer will treat the property as their own, because it will be their own.
3 Parts of a Rent-to-Own Agreement - When [url=http://www.achbanker.com/home.php]hollister[/url] it comes to transactions in real estate, you cannot escape paperwork. Let's take a look at the three major pieces of paperwork that you will run into when purchasing a home rent to own:
1. Rental Agreement: This outlines all of the terms associated with the tenancy.
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3. Sale Contract: Spells out the terms of sale and purchase price.
As you can see, there isn't much to it. Rent to own homes are becoming increasingly popular and will continue to do so as long [url=http://www.mansmanifesto.fr]doudoune moncler homme[/url] as the housing market is in the muck. Basically, they are a win-win for everyone involved.
Looking for rent to own homes in York PA? Chad Eisenhart is a partner with Rent To Own Home PA.com brings rent to own home sellers together with rent to own home buyers by arranging an owner financed sales agreement. We help buyers who are having a difficult time obtaining financing.