What You Must Know Before Getting Into A Rent To Own House Contract?
Rent to own house can be an excellent choice most especially for those who found their dream home and place but unfortunately, don’t have the money to pay for it. So the question that many want to know is, how you can get into a rent to own agreement?
As for the terms of rent to own house, the seller will set how the agreement goes but most likely, both the renter and property owner will be signing a contract that the renter will be renting the property for 1 to 3 years and on those period, the renter will be paying above the market rent with the excess rent be credited to down payment as contract ends.
Using rent to own, this gives prospective homebuyers a great chance of settling into a house that they wish to buy while saving for the down payment, wait for undesirable reports on their credit or to just simply improve their credit score. Now most of the time, rent to own contract is created when the sellers are in dire need of moving out and their house isn’t selling quick.
Both the homebuyer and the seller should have their contract reviewed by a legal professional as there are several issues that should be addressed. As for the terms of lease agreement, it has to include the length of lease period, amount of the rent, rent credit for the down payment and to how it is held until time of purchase, both parties must agree to write what would happen to the credit if ever the renter has opted out buying at the end of their contract, who’ll pay the property taxes, homeowner and insurance fees during lease period, who is going to pay for maintenance, repairs and utilities during lease period and the likes.
In regards to the renters, it is integral to weigh both your options for saving more and spend less by renting a house and be able to pay for the down payment or sign a rent to own house contract. It is fairly obvious that if the rent to own contract will cost you more, you will still go for it especially if the house has certain features that you want.
Take time to read and understand that as soon as the title is transferred to your name, it will be you who’s accountable for whatever that is going to happen to it. It will be a wise idea as well if you are going to contact a home inspect to carry out an inspection to the property prior to buying it.