Owning a home is a dream of almost all renters but buying it takes years of scrimping and saving on squirreling away the down payment. Along with savings, you must be careful with spending money and meticulous bill paying to keep your credit score high. While in the meantime, you have to pay rent that can be even higher than the mortgage you would pay normally.
What if a portion of your rent will go towards purchasing your rental home after some time? Renting to own a home is the safest option for people who do not have enough resources to buy a home. Stop Renting Perth will help you find the right home according to your needs and requirements in your budget. We have a team of experts and experienced members that work hard to fulfill your requirements.
The Real Risks Of Rent-To-Own Homes Contracts For Buyers
Rent to own home deals can be risky for both buyer and seller, but if the deal is structured properly, it will benefit both. Rent-to-own agreements occur organically and are not listed and marketed the same as conventional sales or rental offers. It is a one-on-one deal based on the personal situations of both parties.
But the problem is that the rent-to-own agreements are few and only arise when a landlord is interested in selling their property in the future. The other factor that makes rent-to-own agreements successful is a tenant interested in buying the house but needs some time to either save money for the down payment or raise their credit score.
In short, the rent-to-own agreement only works when both sides have a win-win situation. Following are some points you should take care of before signing any agreement:
Rent May Be higher
The major problem that most people face is that not all the credit portion of your monthly rent will go towards purchasing the house because of the goodness of the landlord’s heart. They all need something in return. The catch is you will have to pay more per month than average rent, and not all of the extra amount you pay will go toward the purchase credit.
For example, the standard rent for a property in Perth is $1,700 a month, but the landlord is offering rent to own agreement for $2,000 per month. We do not think that all the $300 will go into credit, but only $200 will be credited, and $100 will be saved by the landlord.
Contact us, and we will try to cut a deal that is best in your interest. All your money is credited to avoid any problems while buying the house after some time.
Paying less for the house
Giving hundreds of dollars per month for the purchase of a property before you can afford the mortgage sounds smart on the surface, but when you go deeper, you will see that the credit sum does not sum up to much. It is just like buying a car on a lease. You will pay a lot more when purchasing the vehicle outright.
For example, if you are paying $2,000 a month in rent to own a deal for a $400,000 house and the landlord agrees to put $200 a month towards the price of the house, then by the end of the year, you will have $2,400.
And by the end of 5 years, it will be only $12,000 credited against the agreed purchase price. It will only get you into the deal in the first place. We will help you to buy a home in Perth.
with an agreement that is beneficial for you.
Our job is to map out ways that will lead to easy buying of a house. Stop renting today and contact us for the rent-to-own property. It will not just help you get some money in the right way but also pay you well in the long run.
Frequently Asked Questions
How does rent-to-own benefit you?
Rent-to-own home greatly benefits the tenant because, in this way, the tenant can make regular payments to the landlord. It also helps to increase and improve your credit score, which is helpful for application and qualification for a mortgage.
Is it better to own your own home or to rent? Why?
Renting a home is the best way because you don’t have to pay a lot of money as a deposit payment in one go. You can pay the money in small installments along with the rent of the house. This way, you can improve your credit score and easily qualify for a mortgage.
Does rent-to-own hurt your credit?
Rent to own does not hurt your credit but helps you improve your credit. With improved recognition, you are more eligible for a mortgage and can easily qualify for it. This way, you don’t have to move a lot, and many of your problems are solved in one go.
Read more about How To Start The Rent To Own Homes Process.