Rentals in Bronx>Question Details

S, Home Buyer in Bronx, NY

I see several rent to own listings here. Are these viable options? What are the pros and cons of this type of transaction?

Asked by S, Bronx, NY Fri May 3, 2013

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Beaware of these Rent to own postings, lots of times they fall through the cracks. Speak to a loan officer to see if you qualify now to purchase while its still a buyers market. Why pay for someone's mortgage.

Speak to a licensed Real estate agent Today, to help you with this Search!

Owning a Home is a Tax Shelter and much much more!

Best of Luck!

Millie Valentin
Exit Realty Search
3928 E. Tremont Avenue
Bronx, NY 10465
Web Reference: http://throgsneckhomes.com
1 vote Thank Flag Link Sat May 4, 2013
Be careful and work with legitimate rent to own postings.

Many can be scams.

Work with a Realtor or Lawyer.

Good luck
Perry
Web Reference: http://www.ruthandperry.com
0 votes Thank Flag Link Sat May 4, 2013
I have found RENT TO OWN as a viable option when: The buyer needs between 18-24 months to fix their credit to get a loan; the buyer finds a home they like and the seller doesn't mind waiting to sell.

I'm NOT an attorney BUT usually I get a lease and sales contract together.....I require the buyer to put down a NON-REFUNDABLE fee ($3,000 to $5,000). If they purchase the home, it's a CREDIT towards the cost of the home (check with the mortgage company to see how it can be applied) and if the buyers decide NOT to buy that home, seller keeps the fee (the fee is split between the seller and myself towards the commission....the balance of the commission is paid when close so the seller and I are compensated either way).

In the contract they do a home inspection BEFORE they move in and small repairs are paid/done by the buyer with sellers written approval. We get a PRE-APPROVAL from a mortgage company indicating what needs to be done for FINAL APPROVAL.

The lease/contract is treated as a lease if non-payment occurs....As long as the buyer does what they are suppose to do, it's a WIN-WIN.

Call me at 757.287.1433 or e-mail me at williambrownrealestate@gmail.com for more details........
0 votes Thank Flag Link Sat May 4, 2013
Most Rent-To-Own contracts fail and the buyer does not follow through with them, leaving the seller with the non-refundable down payment.

Seller = Good

Buyer = You may just want to Rent
0 votes Thank Flag Link Sat May 4, 2013
Good morning S,

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

*If you thought my answer was helpful, please give me a “Thumbs Up” or “Best Answer.” Thanks!
0 votes Thank Flag Link Sat May 4, 2013
Keep in mind that rent to own can be risky and one could stand to lose a bit of money, therefore do inform yourself well, and consider consulting with an attorney who specializes in real estate beforehand. If you haven't done so yet, visit with any licensed loan officer, see if you can buy outright.
0 votes Thank Flag Link Fri May 3, 2013
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