Why Rent-to-home

In today's economic downturn, home buyers are facing problems in buying a house

. To relieve the problem, individuals are finding alternatives to buying. The innovative Rent-to-Home process is an effective way to own a house and is becoming extremely popular.

Rent-to-Home works on a simple process of renting your home to a potential buyer. This agreement takes place over a 3 year period and then the property is purchased or the renters can opt out. At the end of the term, the renter has the option of buying and owning the house completely. Additional rent premiums can be made towards the purchase price of the home. The renter may be requested to pay 1%-5% of the price each month. Along with rent, the borrower/renter may also pay an option fee of 1%-5% of the price which is attributed to the purchase price. An additional rent premium is also credited to the purchase price.

A Rent-to-Home contract needs to be concise in its wording for both buyer and seller to avoid any later discrepancies. The slow buying market has many home owners sitting on property they cannot sell. The Rent-to-Home alternative gives sellers and buyers the opportunity to benefit in today's market. The buyer can request owner financing by the seller when purchasing the home. Also buyers can benefit due to the slow payment mode.

Owner financing is a great option for families who have a less than modest credit score, hindering the ability to obtain a home loan. The seller and buyer simply agree on an interest rate, term of the loan, and amount of monthly payments. In the buyer's market, owner financing is a viable option. Flexible payment options may include balloon payment, interest only, or rate amortization.

Interest rates can be adjusted by the owner if agreed upon as the market changes. Rent-to-Home and owner-financed properties have become a favorable option for both parties. Owners needing to sell may find these choices advantageous due to an unsteady housing market.

The buyer is given a chance to purchase a home without the difficulty of obtaining a down payment or problematic mortgage. Though sellers would want one time payments, rent-to-home and owner-financed homes have their own advantages.

by: Jim Parker..

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