Home Buying in Garland>Question Details

Kim&patrick…, Home Buyer in Garland, TX

Is that a good ideas to rent to owned a home? Needs your advice

Asked by Kim&patrick Russell, Garland, TX Mon Feb 18, 2013

Help the community by answering this question:

Answers

9
Brent S. Rice, SFR’s answer
Kim and Patrick,

There are very good reasons that Texas law does NOT allow us as Realtors to be involved with lease to own transactions. In other words, it is NOT A GOOD IDEA due to the many complications that can arise and, potentially, end up in lawsuits.

Your best strategy is to simply lease until you can accumulate enough money for a down payment (talk to a lender of your choice about the various programs that may not require a down payment) and/or get your credit score in tip top shape so that you can take advantage of these low rates.

If you have a large enough down payment (e.g. 10% or more), then you MIGHT find a seller willing to provide seller financing, which is different than a lease to own transaction. If you pursue this strategy, then expect that the interest rate would be higher than most traditional lenders and the seller will likely be much less willing to negotiate the price.

There is an old adage in the real estate business..."My price, your terms"...or "Your price, my terms". Sellers who offer financing consider this Their price and your terms. The other end of the spectrum is to pay all cash. Then you can typically negotiate the price.

Good luck. Be cautious. Be SMART.

Brent Rice, Trulia Top Recommended Broker (Pro & VIP)
The Rice Group, Inc.
Website: http://www.ricegroupinc.com
214-808-3100
Brent@RiceGroupInc.com

(If my answer addressed your question and was helpful, please indicate by giving me a THUMBS UP or BEST ANSWER)
1 vote Thank Flag Link Mon Feb 18, 2013
NO.
see Home Buyer Due Diligence Links
see TX Disclosure Brokerage Services
at http://www.ebuyeragents.com
1 vote Thank Flag Link Mon Feb 18, 2013
No. Wait until you can purchase with a traditional mortgage.
1 vote Thank Flag Link Mon Feb 18, 2013
Only if you have to and the deal is actually a good one... Which is usually not the case, call me and I can help you get into a home, fix your credit and purchase within a few months.

Randy
214.984.1213
0 votes Thank Flag Link Sun Mar 31, 2013
Hi Kim and Patrick,

I will not recommend you to do that. However seller financing could be a better route for you.

Good luck

Dixon
Realtor
http://www.findyourtexashome.com
0 votes Thank Flag Link Tue Feb 19, 2013
This is not a highly recommended option, but if you do not qualify to purchase a home (i.e. poor credit, foreclosure or short sale on your record, no cash down payment) a lease option can be a possibility.

Buying the property off a lease option requires two agreements. First, you create a lease agreement. It is writing as if you were simply going to lease the property. This is a standard document.

Next, you will need a Lease Purchase Agreement (or Lease Option Agreement) which spells out the term, option fee and rent premium. The term for the lease purchase is generally between 1 - 3 years. This document usually comes with a option fee which is a non-refundable deposit which becomes part of the down payment. This is usually 1 - 3% of the purchase price.

You should also be prepared to pay a rent premium. This is an amount above and beyond the rent amount and is applied to the down payments of the property.

If you go this route, make sure you have a real estate attorney prepare your documents to protect both parties. It can be done and it has been done - but like any financial transaction - it needs to be done properly to work.
0 votes Thank Flag Link Tue Feb 19, 2013
Never....

It's often a big problem for both buyer and seller.
If you want to rent....just rent....
If you want to buy,....buy...

but don't mix the two up.

You can always make an offer to buy later when you are ready. Maybe on this house, but maybe on another.

Seems like about 90pct of the time the rent to own thing is a scam.
0 votes Thank Flag Link Tue Feb 19, 2013
Bruce Lynn, Real Estate Pro in Coppell, TX
MVP'08
Contact
Always purchase a home.

1. Fixed rate on your mortgage never vs. rental increases.
2. Annual tax write off's confer with your CPA
3. No more landlords telling you what to do
4. Real estate when you retire home is paid off ... live FREE of any further payments EXCEPT for insurance and taxes.

Contact my office today where I can show you many amazing homes work with your family specifications.

Lynn911 Dallas Realtor & Consultant
Multimillion Dollar Sales Producer
972-699-9111
http://www.lynn911.com

Follow me on Facebook
http://www.facebook.com/lynn911dallas
0 votes Thank Flag Link Mon Feb 18, 2013
It can be a great idea or it can be a very bad idea...really just depends on many factors. But make sure you don't do it without the assistance of legal counsel. Far too many problems can arise if not properly structured for the seller or the buyer.
0 votes Thank Flag Link Mon Feb 18, 2013
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2014 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer