Are there any rent to own properties anymore?

Asked by Nrocco, Arlington, VA Fri Sep 28, 2012

I pay over $1800/mo for rent. I would love to own but don't have enough for a down payment. My credit is good.

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8
Marcia Burgo…, Agent, Arlington, VA
Mon Nov 19, 2012
You want to look for a true investor landlord. Chances are, they may not be working with a Realtor. Why wouldn't you just buy? Maybe credit is an issue? Find a good lender who can tell you what to do to improve your scores so you can buy sooner and take advantage of tax benefits.
0 votes
Jane Jensen, Agent, Mclean, VA
Fri Sep 28, 2012
Rent to own is an option a homeowner may offer if the market is soft and they want or need to move.
In Arlington, Va we don't really have a soft market. There are enough active buyers here that most people are able to get a price for their home that will allow them to move on. In another part of the country this would probably be a more viable option.
0 votes
Vivianne Rut…, , Fairfax County, VA
Fri Sep 28, 2012
You received many good HONEST answers from my colleagues - sadly, not all real estate agents are honest about rent-to-own leases.

In the end it is YOUR decision to make; however, I would discourage that option. While occasionally those transactions do work out and result in happy home ownership, statistics do show that majority of rent-to-owns buyers do NOT purchase the home they contracted to purchase. The most common reason is that once the buyers' credit is repaired, they prefer to select a home from the large INVENTORY of homes now available to them. Also, there are very few rent-to-own homes available and most are overpriced.

Since your credit is good, I suggest you look at other options that will allow you to save enough for a downpayment. Did you consider taking at least temporarily another job which would allow you to save more money for the downpayment? Contacting Arlington County to see if you qualify for County loan programs is also a good idea.

Good Luck
0 votes
Carol, Jerry…, Agent, Arlington, VA
Fri Sep 28, 2012
There are lots of loan progams available, and some of the local jurisdictions have programs that provide money for down payments. Check with the housing authority of your local jurisdiction for programs available, and then with an agent who can recommend a knowlegable lender.
0 votes
Ron Thomas, Agent, Fresno, CA
Fri Sep 28, 2012
Lease/Option
You are desperate!
Your Credit or Finances, or both, will not allow you to go the conventional route:
You need the Seller to help you out!

The Seller will know it, and you are going to pay dearly for this service:
There aren't too many altruistic Sellers out there.

The terms that can be written into a Lease/Option can be dangerous to you:
How long is the Option period?
How much money are you putting in to the Option?
What happens if you are not able to execute the Option?
How do you know what your financial situation will be 2-5 years from now?
How much is the rent in the meantime?
Who will be responsible for maintenance and repair in the meantime?
What will be the Market Value of the home in 2-5 years?
What will be the Selling price 2-5 years from now?

This is the Ultimate Caveat Emptor!
0 votes
Misty Mount, Agent, Yorktown, VA
Fri Sep 28, 2012
Rarely do we see a home listed as a "rent to own". Typically people are selling their homes because they want to move on and don't want to be tied down to it any longer. Realize that even with a rent to own there is still a down payment involved, typically 10% of the sales price. If you default on payments, you do NOT get that back.

Have you considered speaking to a lender about your situation? Even if you're unable to purchase right now, a good lender will be able to sit down with you and give you a plan of action to move you toward your goal of home ownership.

If you were my client I would possibly discuss the idea with the listing agent. If your credit is good enough and you have the downpayment and good rental history, maybe an owner who had not considered that option, would be willing.
0 votes
Jim Simms, Mortgage Broker Or Lender, Louisville, KY
Fri Sep 28, 2012
Rent to own is probably not what you expect. In this type of transaction the underlying assumption is the seller will be able to perform in addition to the tenant/buyer. Be careful putting up any large sum on a rent-to-own, most buyers and sellers are under the impression whatever deal they put together will be accepted by any lender when it comes time to actually purchase a home, not true. The mortgage underwriting guidelines are very specific and an underwriter may not agree with the terms on your original lease option. You may think all or part of the rent paid goes to down payment, not necessarily how it works when it comes time to get a mortgage and close the deal.

There is a lot of information on the link below. I hope my observations keep you away from harm, good luck.

Jim Simms
NMLS # 6395
JSimms@cmcloans.com
Financing Kentucky One Home at a Time
0 votes
Scott Godzyk, Agent, Manchester, NH
Fri Sep 28, 2012
Most rent to own homes are not listed that way but listed for sale where the seller muct move but has not sold yet. your best bet is to work with a buyer agent who specializes in rent to own to help call the listing agents to see if their sellers would be open to it
0 votes
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