subject: Lease to own homes - Advantage Leasing to Own [print this page] Lease to own homes - Advantage Leasing to Own
Users are quite familiar with the bike to its concept. The strategy provides a way for people to rent or lease of the things that they can not afford to buy outright. Give people something to use today, but do not actually buy it the first thought is that the concept of rent to own (LTO) at home.
Canadian Rent to own homes offer several different benefits, it is a wise strategy for those who do not qualify for a mortgage today. We describe five of these advantages below.
Savings deposit
Rent to their homes is to provide professional tools for the tenant to buy a home in the past. Tenant rental home they want to end up the same for a certain period of time to do two things - to build their deposit and establish credit.
Canada, the potential home buyer is today's contribution of at least 5% plus closing costs to obtain a mortgage and CMHC (Canada Mortgage and Housing Corporation) insurance. The first advantage of rent to own home is that it acts as a forced savings plan for a flat rate of rent is set aside each month. The typical Canadian LTO help save enough money to tenant lease for CMHC insured mortgages end.
Personal credit repair
The other half is to hire your own picture involves helping the tenant to repair their credit. Sometimes the tenant will be able to do it just to make their monthly lease payments on time. Other times they may have to work closely with the credit counselor to rebuild their credit score or cut their existing debts throughout the period of LTO.
On a good credit score, low debt and a reasonable down payment to get the tenant mix will help the banks to say "yes" when they apply to mortgages. They also have a background in financial management, and therefore most attractive to lenders in the future.
Fixed lease payments
The third advantage of renting to own a home, the monthly lease payments are fixed over time hire. Normal lease allows the landlord to increase the Ontario rent a certain amount every 12 months.
This is not done until its lease agreement, as there are monthly payments in any amount, can affect the affordability of the tenant. A fixed monthly rental is determined with certainty tenant costs and allows them to budget, knowing that their basic housing allowance will not increase.
Guaranteed Purchase Price
In addition to the fixed monthly rent, rent to own as well as determine the future of the purchase price of the house. This is done in Ontario with an accredited mortgage professional for help when they have been approved for LTO house tenant, as well as a licensed brokerage house my tenant once they want to eventually buy.
Before you decide what the final purchase price will be, the current tenant's household income, outstanding debts, what they can reasonably afford to buy and appreciation of the historic neighborhood of choice has already been taken. Agree that the price, give the tenant peace of mind that their contributions will be enough to buy a home, regardless of its actual value.
Create Instant Equity
When the tenant has been approved LTO home they are required to forfeit security - currently 2-3% of the approved purchase price. This security is ultimately included in the final contribution by providing home ownership to the lessee from the date on which they make their contribution.
The lessee is not only donated his property has one. Most homeowners usually do some type of upgrade to their home, whether it is in the yard or the kitchen cabinets new deck.
The same is often true of rent to own, because the tenant does not have to wait until they can buy a house to start improving it. With the owner's approval, they can make improvements that usually increases the value of the home and creating additional equity for themselves when they buy homes.
Tenant is not eligible for a mortgage today can use the lease-purchase home in just 24 or 36 months. This strategy helps tenants save their deposit and credit repair. Fixed lease payments and the guaranteed purchase price for them, the cost certainty. The fifth and perhaps most appealing advantage of the tenants an opportunity to increase the value of your home before it actually belongs to them and possibly reduce the CMHC premium process. So you can have your cake and eat it too!
