Home Buying in Cerritos>Question Details

Peaceandpowe…, Real Estate Pro in Bell And Hurd, Paine...

Are there really rent to own houses available in Cerritos?

Asked by Peaceandpowerparenting, Bell And Hurd, Painesville, OH Sat Sep 15, 2012

Do theyneven exist at all?

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Probably. Here's a link to a blog I wrote on how to find rent-to-own homes: http://bit.ly/findaleaseoption

Let me clarify a few of the comments below.

First, technically, there's no such thing as "rent to own." It can be a "lease-option" or "lease-purchase." A lease option allows you to rent and gives you the right (but not the obligation) to purchase. A lease purchase allows you to rent but obligates you to purchase. Either can be OK, though a lease-option usually is better from the tenant-buyer's standpoint.

Do NOT, repeat NOT, rely on a "first right of refusal" that might be contained in a lease. Check with a lawyer for all the reasons. Basically, that's almost no protection, and certainly less than if you have a recorded option (or "notice of agreement"). Further, one of the beauties of an option (or a lease-purchase) is that it locks in the price. In the case of an option--just as with the "first right of refusal"--you can walk away rather than purchasing. But with an option you know what the price will be. With the "first right of refusal," you don't.

Beyond that, "first right of refusal" applies only if the owner chooses to sell. You find the perfect house. You want to buy it in a few years. With an option, you've got that right. With a "first right of refusal," the owner legitimately can say, "No I don't want to sell." So you're living in limbo for all those years.

With a lease-option or lease-purchase, you can negotiate (and generally do) that a portion of your rent is applied to the purchase price. That's very rare with a simple "first right of refusal."

I could go on and on. But the point is, if you're interested in buying the home, a "first right of refusal" gives you almost no protection and certainly no leverage.

Hope that helps.
0 votes Thank Flag Link Sat Nov 3, 2012
Don Tepper, Real Estate Pro in Fairfax, VA
MVP'08
Contact
Normally, Leases comes with the first right of refusal. Find the house to lease, and then negotiate the option along with negotiating the lease. Keep in mind Rent To Own is different from Lease Option to Buy.
Good Luck
Eden Lim
714.586.3109
0 votes Thank Flag Link Sat Sep 29, 2012
I agree whole heartily with Emily's answer below. There aren't many of these deals around these days and I nave have liked them.
0 votes Thank Flag Link Sun Sep 16, 2012
Don't do a "lease option or rent to own". It does not make very good sense in this type of volatile market. The only time in recent history a lease option was a good idea was between 2003-2005. In 2003, let's say you did a lease option for 2yrs with an owner & agreed on a price of $300,000 & with your $10-15K in option money should you have "exercised" your option to buy, you could have at any time in those 2yrs.

And when the market jumped you could have purchased at $300K, say in mid 2004, when the home value boomed & became, say, $475K, then the owner was up a creek without a paddle & you just scored big time.

These days, your best bet as you're cleaning up your credit & being good with paying your bills, just simply get into a regular lease, put up your 1st mo + security deposit & if you REALLY like the house you're renting, put a CLAUSE into your lease that states "Tenant has the right of first refusal should the landlord wish to sell the property during or at the end of the lease term".

This gives you first dibs on the house to place an offer & unlike the lease option, you will not put any other "option" monies at risk. Lease option monies are non-refundable, should you choose to NOT exercise your option to purchase within the specified time frame.

I don't look back on this same Trulia posting for answers after mine.

Emily S. Knell
Realtor Since 1996
Realty One Group
EmilyKnell1@yahoo.com
562-430-3053 c
0 votes Thank Flag Link Sat Sep 15, 2012
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