Tricity Property Searches
  • Home
  • Interior
  • Furniture
  • Exterior
  • Garden
  • Festivities & Events
  • Stories
No Result
View All Result
  • SPONSORED GUEST POST
  • ADVERTISE
  • STORIES
  • Home
  • Interior
  • Furniture
  • Exterior
  • Garden
  • Festivities & Events
  • Stories
  • SPONSORED GUEST POST
  • ADVERTISE
  • STORIES
Tricity Property Searches
No Result
View All Result
  • SPONSORED GUEST POST
  • ADVERTISE
  • STORIES
Home Property

The First-Time Homeowner’s Guide to Rent-to-Own Homes

Suri by Suri
June 18, 2022
in Property
Reading Time: 5 mins read
488 5
A A
0
The-First-Time-Homeowners-Guide-to-Rent-to-Own-Homes

The-First-Time-Homeowners-Guide-to-Rent-to-Own-Homes

740
SHARES
3.5k
VIEWS
Share on FacebookShare on Twitter

Table of Contents

    • RelatedPosts
    • 6 Gigs To Find Your First Time Home In Arkansas
    • What You Should Know Before Hiring a Realtor
    • 5 Condo Living Tips for Your First Apartment
    • Split Level Houses vs. 2-Story Houses: Which is Better for You?
  • Rent-to-Own: How It Works
  • Benefits of a Rent-to-Own Deal
  • Rent-to-Own vs. Buying
  • Rent-to-Own in Canada

Rent-to-own homes are properties that you can rent for a certain amount of time and buy before the lease expires. It’s basically a way to “secure” a home you like even though you don’t have enough money to buy it yet.

Rent-to-own homes also work for those who can’t get a mortgage approval yet have enough money to afford the house.

But that’s only the tip of the iceberg when it comes to rent-to-own homes. Here’s a more in-depth look at how it really works in real estate.

Header image source: Pexels

RelatedPosts

6 Gigs To Find Your First Time Home In Arkansas

What You Should Know Before Hiring a Realtor

5 Condo Living Tips for Your First Apartment

Split Level Houses vs. 2-Story Houses: Which is Better for You?

Rent-to-Own: How It Works

You can find properties that allow rent-to-own options. Or you can also try to negotiate with a seller to allow you to enter into a rent-to-own agreement. But if they don’t agree, there are also companies that buy the home for you while you enter into a rent-to-own agreement with them.

A rent-to-own setup has two sets of contracts. The first one is the standard lease agreement. This is where you can find details about your monthly rate. It’s also where the landlord’s rules for the property will be laid out.

The second one is the rent-to-own contract. If you go with a lease-purchase agreement, you’ll find it stated here that you have to buy the house before your lease expires. Whether you’re paying in full or getting approved for a mortgage is up to you. The important thing is that you’re required to buy the house.

If you go with a lease-option agreement, you have the option to buy the property before your lease expires. That means you’re not obligated to buy the property once your lease ends. You can walk away from the deal if you end up not wanting to buy the house anymore.

Always read and understand everything—especially the fine print—stated in your contract. If you fail to comply with the terms of your contract, you might lose your rights to the property.

If you want to make sure everything’s good, ask for assistance from a real estate agent and/or attorney.

Benefits of a Rent-to-Own Deal

Here are some of the benefits that a rent-to-own deal can give you:

  • You can immediately move into the house even though you can’t afford it just yet. Just don’t forget that as a tenant, you still have to abide by the landlord’s rules.
  • It gives you time to save up for a down payment. Monthly rents are usually cheaper than the monthly amortizations of a mortgage. You’ll have more time to save up and get your finances in check. That means while renting, you can also fix your credit standing to get mortgage approval.
  • The best thing about a rent-to-own deal is that you get to build equity in the form of rent credits. A portion of your monthly rent goes into rent credits which can then be deducted from the final price of the home when you buy it.
  • A rent-to-own deal is a perfect midpoint for buying and renting. It’s more manageable than buying a house right away since you won’t have to pay a large sum of money upfront. And it’s more worth it than just renting since you also get to build equity and eventually own the home once the lease is up.

Rent-to-Own vs. Buying

Rent-to-own requires a smaller down payment than buying a home. It comes in the form of a non-refundable initial option fee which is usually 1–5% of the total purchase price. This works as some sort of a deposit or reservation fee so that you can lock in the home until you have the financial capacity to buy it.

But while that’s tempting, it’s still important to note that buying a home will be less expensive in the long run. The only additional amount you’re paying besides the house price is the interest. In rent-to-own, you’ll have to pay rent for about 1–5 years and then your mortgage after.

Also, buying gives you the freedom to do what you want with your house—because it’s yours. You won’t have to worry about rules set by a landlord as you would in a rent-to-own setup.

Rent-to-Own in Canada

Image source: Pixabay

So, what is rent-to-own? It’s a way to build equity for a home without the stress of saving up for a large down payment and paying monthly amortizations for your mortgage. It’s the best way to “reserve” a home you love while you come up with the money to pay for it.

To recap, here are the benefits of a rent-to-own deal:

  • You can move into the house immediately even though you’re still saving up to buy it.
  • You can fix your credit score or save up for the down payment while renting.
  • You get to build equity for the home and own it after the lease expires.
  • You can manage a rent-to-own deal better than you could manage to buy a house. It’s also more worth it than just renting and getting nothing to your name once the lease ends.

There are a lot of options for rent-to-own in Canada. Companies offer rent-to-own packages with very affordable down payments. Having a mortgage broker on your team, apart from your realtor and lawyer, makes the whole process more manageable, especially if you’re a first-time homebuyer.

Tags: leaserent
Share296Tweet185Share74
Previous Post

Split Level Houses vs. 2-Story Houses: Which is Better for You?

Next Post

What Is A Contemporary Bathroom? Contemporary Bathroom Ideas | 37+ Photos

Suri

Suri

Apart from being a content writer who writes blogs and articles pertaining to Home Decor & Home Development, Suri is the co-founder of Tricity Property Searches with Mr. Ravi Tarvan. With Ravi, Suri also partners in another online venture, which is known by My Trendy 10

Related Posts

6 Gigs To Find Your First Time Home In Arkansas
Property

6 Gigs To Find Your First Time Home In Arkansas

by Suri
June 23, 2022
0

When you are a first time home buyer Arkansas all you can think about is all those immaculate houses you have seen in those glossy magazines. You may register yourself to various home buying apps and...

Read more
What You Should Know Before Hiring a Realtor

What You Should Know Before Hiring a Realtor

June 21, 2022
5 Condo Living Tips for Your First Apartment

5 Condo Living Tips for Your First Apartment

June 20, 2022
Next Post
What Is A Contemporary Bathroom? Contemporary Bathroom Ideas | 37+ Photos

What Is A Contemporary Bathroom? Contemporary Bathroom Ideas | 37+ Photos

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

I agree to the Terms & Conditions and Privacy Policy.

Find an Ideas

No Result
View All Result

Category

  • Appliances
  • Exterior
    • Backyard
    • Boundary Wall
    • Fire Pit
    • Front Elevation
    • Gate
    • Parapet
    • Patio
    • Pools
  • Festivities & Events
  • Furniture
    • Bed
    • Chair
    • Cupboard
    • Sofa
    • Table
    • Wardrobe
  • Garden
  • Home & Decor
  • Home Improvement
  • Interior
    • Bar
    • Bathroom
    • Bedroom
    • Ceiling
    • Dining Room
    • Doors
    • Home Office
    • Kitchen
    • Living Room
    • Railing
    • Utility Room
    • Wall Decor
    • Windows
  • Maintenance & Repair
  • Property
  • Rangoli Designs
  • Restaurant & Cafe
  • Sponsored
  • Tips and Advices
  • Zirakpur
Facebook Twitter Youtube Vimeo Instagram
living room interior design

Navigate

  • Home
  • Contact
  • Disclaimer
  • About Us
  • Privacy Policy

© 2022 Tricity Property Searches

No Result
View All Result
  • Home
  • Interior
  • Furniture
  • Exterior
  • Garden
  • Festivities & Events
  • Stories

© 2022 Tricity Property Searches

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.