# I would like to get connected to an investor or a company that will allow me to rent to own a house in Charlotte, NC

Asked by Tremaineandserena, Charlotte, NC Thu May 30, 2013

I have already located 2 houses that I would like to purchase but my credit has taken a major hit over the last 18 months due to various circumstances beyond my control.

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

You may be able to find one the way you describe: Identify a property, then have an investor buy it. The problem there is that it may not be a particularly good deal. That is, the seller may not be particularly willing to negotiate on the price with the investor. Here are a couple of hypothetical examples:

Example 1: You identify a property you'd like. It's priced at \$200,000. The seller wants to sell, but isn't too flexible on the price. He's willing, perhaps, to reduce the price to \$190,000 (5%). The investor pays \$190,000 for it. The investor will want a 12%-15% return on his investment, maybe more. Assuming the investor paid all cash--his cash--he'll need a return of \$28,500. That would be a payment to him of \$2,375. Actually, a bit less once you've paid him an option fee. Assume a 3% option fee. And assume a markup on the house price to \$225,000 in 2 years. That means you'd pay an option fee of \$6,750. So the investor, looking for a 15% return on \$183,250 (\$190,000 minus \$6,750) will need \$27,487 a year, or monthly payments of \$2,290.

In today's market--assuming decent credit--you'd be able to buy a \$190,000 property with payments of about \$875 a month. (That doesn't include taxes and insurance, both of which would be pretty low.)

So: \$875 on your own, or \$2,290 with an investor buying it, paying retail price, and needing a 15% return on investment.

You'd get a better deal if the investor located a property with a retail value of \$190,000 that he could purchase for, say, \$145,000. In that case, the option price might be \$200,000. You'd provide an option fee of \$6,000. The investor, needing a 15% return on his out-of-pocket cash of \$139,000, would need \$20,850 a year, or \$1,737 a month. You're still paying a lot, but it's less than if you choose a property that has to be bought at a retail price.

I really like lease-options in the right situation. But if you'd be able to clean up your credit and buy within 9-12 months, it makes more sense to do that than to do a lease-option.

Hope that helps.
1 vote Thank Flag Link Thu Jun 6, 2013
MVP'08
Contact
Wilson Real Estate Investment, LLC. 704-469-2843

Specializes in working with people who are in your situation. Solving and working with buyers to help them through issues that prevent them from conventional financing. We have a lease with option to purchase program. We help you through the process of leasing and making a offer to purchase. Many times we will purchase a property specific to a buyers needs.

Ceno Wilson Managing partner
Wilson Real Estate Investment
704-469-2843
http:// theleasetoowncharlotte.com
http://wilsonrealestateinvestment.com
Be very careful with a Rent to Own house. Often times, the owners require non-refundable money down and even use their own contracts. I have heard of homes going to foreclosure and the buyer/tenant losing their money they put down. I have also heard of contracts that say if you do not close by a certain date that you lose your money. You may also be responsible for doing all repairs on the home from the time you move in. If you do not have a home inspection, then you have no idea what expensed you may incur for the repairs. You also have no negotiating on the sales price of the house. I recommend that people do not do Rent to Own but instead rent a house until they are able to purchase a home outright. If you do decide to do this, please be sure to hire an attorney to read all paperwork before you sign anything.

Good luck!
Have you talked with a lender about what it would take to fix your credit? You maybe better off than you think. Also, have you looked into NACA? NACA is a great program that does not base their lending decisions on credit scores. I would be happy to talk with you about it if you would like some more information.

Kelly
You can begin searching owner financing and rent to own homes for free in Charlotte right here: http://www.renttoownquest.com/search/North_Carolina/Charlotte

Also, if you find a home that interests you speak to the seller. If they are a Realtor then you will have found an agent in your area who works with rent to own houses.

Good luck!