what are normal terms for rent to own houses?

Asked by Nuface, 76102 Thu Jan 26, 2012

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7
Rick DeVoss, Agent, Ft Worth, TX
Thu Jan 26, 2012
BEST ANSWER
You probably meant to say: "What are the normal terms for rent-to-own contracts?"

Since such a contract has not been approved by the Texas Real Estate Commission, there are no normal terms. People from other states should not be trying to answer questions that are governed by Texas Laws.

TREC will not allow a real estate agent to participate in writing such a contract. They are full of pitfalls. I have spoken to some attorneys who will not have anything to do with a "rent-to-own" or "lease-to-own" contracts. You should not even think of signing such a contract until you hire an attorney to represent you.

Here is a piece of good advice: go rent a house for as long as it takes you to get your credit report cleaned up, and then you can apply for a loan to buy a house. Don't deal directly with the owner; get a Realtor to represent you. Whenever you are investing large sums of money, get professional advice.

Good luck!

Rick DeVoss

---The Michael Group

817-300-6121

Experience:
---32 years selling Real Estate in Texas and New Mexico

---15 years as a Certified Credit Repair Instructor

---Saving money for people on their electric bills with a 7-year-old company

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1 vote
Barbara Coker, Mortgage Broker Or Lender, San Antonio, TX
Fri Jan 27, 2012
These agents are giving you good warnings about this type of situation. There is great risk, and that is why there are no TREC promulgated forms to fit it.

From the lender's standpoint, I need to add that any "rents" that the seller would give you back as credits towards your down payment are only allowed to the extent that they exceed the fair market rent, as determined by the appraiser. You would need to provide cancelled checks to prove your payments. Of course, he can pay closing costs and prepaids, again following the guidelines of your mortgage type.
Web Reference:  http://www.thecokerteam.com
0 votes
Dallas Texas, Agent, Dallas, TN
Thu Jan 26, 2012
Typically most Realtors don't recommend these types of transactions they can turn into night mare situation. The type of contracts vary per home .

Lynn911 Dallas Realtor & Consultant, Credit Repair Advisor
972-699-9111
http://www.lynn911.com
0 votes
Donnie Keller, Agent, Fort Worth, TX
Thu Jan 26, 2012
There are no normal terms. Beware!!! These are very risky deals.
Web Reference:  http://reatarealty.net
0 votes
Paul and Col…, Agent, Southlake, TX
Thu Jan 26, 2012
The terms are completely negotiable between the parties and there really are no "normal" terms. I would recommend engaging an attorney in this type of transactions are there are risks involved in the transaction.
0 votes
Tim Moore, Agent, Kitty Hawk, NC
Thu Jan 26, 2012
The terms will vary and almost always protect the seller/landlord. They are tricky to write to protect a renter who usually gets the shaft in these deals. Seek a lawyers advice since you really need it to be right or you could lose thousands in a year or two.
0 votes
Gary Geer, Agent, Antioch, IL
Thu Jan 26, 2012
Nuface,
There are rent to own contracts that define all of the terms. Ask a local real estate professional in your area for a copy of the contract. A local attorney can also help you with this. An example could be a lease with a rent to own section.
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