If you desire to own your own home but are unable to secure conventional financing today, leasing a home with an option to buy may be your best option. A lease purchase can make your rent money work for you instead of making your landlord rich. Typically rent to own homes offer rent credits that reduce the final purchase price!
Here’s how it works:
A home is made available via a standard lease with one important addition. Included is an option to purchase that home at a specified price over a specified time period (usually one or two years). In order to acquire that option, the renter/buyer must pay a one time, NON REFUNDABLE, fee called the option consideration. The exact amount is negotiable, but it is usually ranges from 2.5 to 7% of the purchase price. A fair contract will credit the buyer 100% of that option consideration upon closing of the sale. Furthermore a negotiated percentage of all rent payments should be applied toward the purchase price of the home. Some typical terms and conditions one might expect to find in a contract follows:
-> In order to receive a rent credit of 50%, time is of the essence. You MUST pay your rent on or...
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