Home Buying in Philadelphia>Question Details

Sharon Amerm…, Home Buyer in New York, NY

I was wondering how to go about getting a rent to own property with no money down.Can someone please help.?

Asked by Sharon Amerman, New York, NY Mon Apr 22, 2013

I am looking for a home in the 19125 zip code.

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5
Good morning Sharon,

Rent To Own is a better deal for the Seller than it would ever be for a potential Buyer.

The basic concept is finding a way to "force" savings towards a down payment by including a portion of the monthly rental that goes towards that savings. You pay your rent every month and your Landlord deducts a pre-determined amount to hold in a special bank account, called an "escrow" account. Your Landlord holds that money until you have saved up enough---through this "forced-savings" method---to meet a down payment to purchase the home.

The terms of the purchase price, including the down payment amount, and the amount to be set aside from the rental for down payment, are all set down at the time of lease signing.

It's all about helping the renter/tenant save up enough money for a down payment to buy a home (in this case, the one you're renting). But this is a better deal for the Seller because he gets to lock in a purchase price and a buyer today for a future sale.


Saving money for a down payment? Well, heck, you can do that on your own.


If you are dedicated to the idea of buying your own home, you can create your own savings plan to save up enough money for a down payment. And when you have saved up enough for a down payment, if that takes a year or two or more, YOU get to decide on the price you're willing to pay for the house at that time based on current market conditions. You won't be locked in to a price that may be a lot higher than what the house is worth in the future.

With Rent To Own you'll be locked in both to the house and to the price, even if it takes you 3 years to save enough through the forced savings of the rent payments. What happens if three years from now your life situation has changed? Maybe you need a bigger/smaller home. Maybe your employment has relocated. Maybe your credit or income is insufficient to qualify for a mortgage loan.


Find a way to save up on your own; not with Rent To Own.


Sit down with a local Mortgage Banker and get yourself prequalified, too. You may find you're better qualified than you think you are, and, if you're not, at least you'll know how much loan your income and credit qualify you for, and how much you have to save towards down payment and closing costs.

Trevor Curran
NMLS #40140
Mobile: 516-582-9181
Office: 516-829-2900
Fax: 516-829-2944
PowerHouse Solutions, Inc.
185 Great Neck Rd, Suite 240
Great Neck NY 11021
Licensed Mortgage Banker – NYS Dept. of Financial Services
NMLS#3528

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2 votes Thank Flag Link Tue Apr 23, 2013
P.S. 19125 zip code is in Philadelphia, not New York.
0 votes Thank Flag Link Mon Apr 22, 2013
I agree with what's been said here, however, I do know of properties offering seller financing. As my colleagues said - rent to lose - 20% down plus monthly payments and 6 or 7 or 10% interest, depending how risky you are as a borrower. It's better for you to rent and work hard towards improving your credit score.

When you are ready to buy, plan to save 3-6% of the sale price in cash to cover your down payment and closing costs.
0 votes Thank Flag Link Mon Apr 22, 2013
Dont rent to own! Go straight to own! We can help even if you have no credit! Check out how:>>>>>>>>>>>> http://www.phillystoprenting.com
0 votes Thank Flag Link Mon Apr 22, 2013
Rent to own homes are rare because they are rarely ever good deals for a renter. To think of finding one that requires no money out of your pocket is like wishing for the Easter Bunny to visit, they just don't exist. Avoid rent to lose deals unless you want to just lose more. Just rent and buy when you really can and avoid rent to lose -- they don't work.
0 votes Thank Flag Link Mon Apr 22, 2013
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