Pat, Renter in Port Saint Lucie, FL

Do you rent homes with option to buy ?

Asked by Pat, Port Saint Lucie, FL Thu Dec 9, 2010

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There are often houses that have been on teh market where owners will offer their homes for a rent to own situation, the majority are not for rent, but found when the listing agents bring an offer to rent to own to the sellers. your best bet is to get a buyer broker who is experienced in rent to own that can help you find some potential listings to see.

You want to make sure you negotiate the lease and the sale as well.

Please see my blog with tips and advice on how to rent to own.
1 vote Thank Flag Link Fri Dec 10, 2010
Pat,

There are a couple different options when contemplating the rental of a home for future purchase. Each involves two legal documents, the lease itself and then either an option or purchase agreement. The option gives you the right to purchase the home at a specified price, for a specified time in exchange for consideration (the option payment). The purchase agreement is a normal purchase agreement with an extended closing date which is typically at the end of the lease. In most cases, the best use of either of these type of agreements is to allow the purchaser time to either sell an existing residence or sort out credit issues that is preventing financing at this time.

A lot depends on your particular situation and it is something you should discuss at length with a professional Realtor® who can fully explain this process to see if it makes sense for you. Remember that we will be ruling out all short sales and foreclosures which currently dominate much of the market in Port St Lucie and the surrounding communities. I would be happy to speak with you in greater detail about your real estate needs so please feel free to contact me at your convenience if I can be of any help.


Always at Your Service,


Tom Priester e-PRO
"Results Driven Real Estate"

Keller Williams Realty
561 308-0175
tom@tompriester.com
Web Reference: http://www.tompriester.com
1 vote Thank Flag Link Fri Dec 10, 2010
Hey there Pat.....

Wow. Where do I start?.....Where do I start? Let's start from the bottom post and work our way up this list:

Mr. Felix Hung..........."it's a waste of money to rent to own".... May I ask how many Lease-to-Own transactions you've personally been involved in?

"Questions you should ask yourself:"

1. Why are there rent to own programs?
Answer: Because everyone doesn't fit into an Agent's pretty little box of perfect credit and 20%+downpayment. Some people want to buy but need some time to get their finances in order or to save up for a downpayment or a vast other numbers of reasons. Why not live in the house you are trying to buy ahead of time?
2. Why do they require huge sums for option fees?
Answer: Because they are offering TERMS, you have to pay more. A seller needs to have some kinda commitment that you are serious about buying the house and having them take it off the market. If you have cash and credit....go get a traditional loan! And by "huge"...you're telling me that putting 3% upfront is huge?
3. Why isn't it market rent?
Answer: It DOESN'T MATTER WHAT MARKET RENT IS! If you're just looking to rent.....rent. But for a tenant/BUYER, when you go to get financed, if you've been paying closer to what your mortgage payments are going to be, the lender will look upon this with a more warm and fuzzy perspective.....OR give the amount above market rent back to them as a Rent Credit. Our program gives about 30% Rent Credit.
4. What is the final sales price for this house?
Answer: Depends how you want to structure the deal. Currently, WE set the price at it's current market value and lock it in.....just as a "normal" buy/sell deal would be.
5. Am I really getting a good deal?
Answer: It is a case by case basis. A lease purchase is not for everyone but provides alternative ways to buy or sell.

...."I have never seen a good rent to own program****. " I looked for the disclaimer with your little asterisks but couldn't find it. How bout you check these out?
http://www.LeasingToBuy.com
http://www.LeasingToOwnSolutions.com
http://www.BuyHomeStLouis.com

-----------moving on to our next Agent

Mr. Tom Priester........Nice job of being objective and providing information. I tend to see that from Keller Williams agents. I guess you've read both Gary's books then? :)

-----------moving on to our next Agent

Mr. Kornicki.........."I know of a Lease-option and a Lease purchase method."....same basic principle my man.

------------moving onto our next Agent

Mr. Scott Godzyk........nice job of explaining some good info. Kudos to you.

------------moving onto our next Agent

Ron & Debbie........."such as a sellers market, where this works real well...in today's market which is a Buyer's market, it does not." .....I hear this just about every time i log onto Trulia. Here goes...(((deep breath))) Lease Options can be done very successfully in ANY market. Large amount of sellers/unsold homes=opportunity to move house off market; Large amount of people who need time to work on their credit=opportunity to have someone else make your mortgage payments while they work on finances to buy your house. I could go on and on.
"There are too many buyers willing and able to buy"......What news have you been watching? Oh, wait, you've been reading the NAR articles again, haven't you (sarcasm)? Here's the problem: Too many houses + not enough people that are able to qualify with new lending standards. If there were "too many buyers willing and able to buy", um....why is there still such a high inventory?

------------moving onto our next Agent

Ms. Amanda Stagg.........You started kinda slow, but made a nice comeback in the middle. BUT then dropped the ball at the end by saying...."However, only an attorney can draw up a lease to own option on any property." Can you provide us with the specific Law that will back up this statement? Unless something's changed in the last 24 hours, I believe your statement is false. But, of course, i've been wrong in the past (plenty of times i'm sure) .....so if you could kindly pull out that Law for us....that would be great! My 'guess' is that you'll find a hard time finding that one.

In conclusion, (because i'm getting hungry and my show is coming on), a lease-to-own situation is not for everyone but......if you educate yourself and use professional WHO ARE FAMILIAR WITH doing lease-to-own's, it can give you another avenue where you make look to buy or sell. Here's a link to my blog where I mention ways to find them with and without the use of an Agent.

http://www.trulia.com/blog/hhi_investing_llc/2010/04/what_wa…

Best wishes & Laus Deo,

Darin Ray
Lease-to-Own Professional
Independent Consultant
0 votes Thank Flag Link Fri Dec 10, 2010
A buyers market is usually not a great one for rent to own. But this is also a short sale and foreclossure market, so many homeowners who have been in a situation unfortunate enough to lose thier property are now renting. Also the owners of rental properties are becoming more open to the option to rent out thier homes to potential buyers as a way to release themselves of the property as it is now not as viable as it once was.
I and my office at Illustrated Properties in St Lucie West can certainly help you find a home to rent and negotiate the possibility of rent to own with owners of rental properties.
However, only an attorney can draw up a lease to own option on any property. Illustrated also have a legal team and mortgage department at our disposal for one stop shopping.
Thank you Pat for posing this question. I hope with all of the responses you have found some answers.
Amanda Stagg. Illustrated Properties.
akstagg@att.net
0 votes Thank Flag Link Fri Dec 10, 2010
Pat,

This is a great question and one we get asked often.

There are markets, such as a sellers market, where this works real well. However, in today's market which is a Buyers market, it does not. There are too many buyers willing and able to buy. Also, be careful in just renting! There are scams around such as properties being advertised for rent by people who do not own them. Also, make sure before you move that the property is current on all of its payments.

Beast of luck to you~

Debbie Albert, PA
Keller Williams Realty of the Treasure Coast
Web Reference: http://www.ronanddebbie.net
0 votes Thank Flag Link Fri Dec 10, 2010
I have condos that offer owner financing, no wasted rent money if you have a down payment in North Fort Myers.

Kevin Cloutier
Southern Premier Realty
Cape Coral, FL 33914
1.877.840.3413 Real Estate Hotline
0 votes Thank Flag Link Fri Dec 10, 2010
Most agents do have rent to own options. I'm not sure if it is a popular way to go in this New Real Estate Market.

I know of a Lease-option and a Lease purchase method. There are other ways to achieve your goal as well.

Be certain an engage a Real Estate Attorney. Rent to Own agreements need to be very well planned out.

WATERWAY REALTY, REALTORtS
Sunny Isles Beach Real Estate and Information http://www.sibre.info Sibre@ymail.com. 305.767.2121
0 votes Thank Flag Link Fri Dec 10, 2010
Pat,

Often you can find investors who offer rentals with the option to buy. I see it all the time in all markets. Many including myself personally feel like it's a waste of money to rent to own. Why? Because the rent is usually above market rent and they make you pay an option fee upfront. Many investors find this a great strategy as they can collect $1k-$10k from a renter upfront (NON-REFUNDABLE), then rent it for more than market rent. If you don't buy at the end of the option period, they pocket the monthly cash flow and your option fee.

Your best bet is to fix your credit with the help of a qualified mortgage specialist and buy with a FHA 3.5% down loan. Personally I feel you'll be way better off.

If you are looking for a great REALTOR, my good friend works Port Saint Lucie. Althea Garner 866-774-2899

http://www.houseofhomesonline.com/

Questions you should ask yourself:

1. Why are there rent to own programs?
2. Why do they require huge sums for option fees?
3. Why isn't it market rent?
4. What is the final sales price for this house?
5. Am I really getting a good deal?

I have never seen a good rent to own program****.

Best of luck Pat! Happy Holidays!
0 votes Thank Flag Link Fri Dec 10, 2010
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