Every day we meet people who are tired of renting. They recognize the benefits of owning a home, but are scared to commit. What if you could take a home for a test drive? Do just that by becoming a tenant buyer with a rent-to-own agreement.
If you think that a tenant buyer and a renter are the same, you're WRONG. A tenant buyer is an individual who is leasing a home with the option to purchase it at the end of a determined period of time. Being a tenant buyer opens you up to benefits a renter can't fathom. A renter does not have the option to purchase the home at the end of their lease, whereas a tenant buyer does. Wondering how it works? Allow me to explain. If you're scared to commit to a home, you can live in it while making monthly payments for a predetermined period of time. (Pssst...If you find the right deal, these monthly payments can be credited to the down payment on the home). If you fell in love with the home during this "test run," you can purchase from the seller. Still not convinced yet? Then extend the "test run" for another year and continue living in the home. It's that simple.
Renters can be wonderful tenants, but they can also be reckless. We all know that. In a rent to own agreement, since you’re both a tenant and the future owner of the home, you’re expected to take greater pride in the property and have greater responsibilities towards it. This means that you’re expected to uphold your duties as a good tenant by taking care of the home as if it were already your own.
While the mortgage, taxes, and large repairs are usually covered by the seller during the option period, you as the buyer are responsible for the maintenance and upkeep of your new home, just as you would be if you bought it outright. What if the roof needs to be replaced? What if the fridge breaks down? We know that you may not have $10,000 stashed away to get a new roof. With Rocena's guidance, you can set terms that state which kind of repairs you'll cover and which expenditures should be the seller's responsibility.
As it is with a bank mortgage, you will be expected to make payments on time. If you don’t there can be financial consequences, such as forfeiting that month’s percentage of the rent that goes towards the purchase of the home. There can also be grounds for legal action--as with any other renter. Don't get evicted!
Being a tenant buyer is basically a bridge between renting and homeownership. You have the obligations of being a good tenant, but you’re also held to a higher standard since you're working towards becoming the property owner. If you understand the value of owning a home but need a little help to get there, explore how you can lease a home & contribute to your down payment instead of renting it & contributing to somebody else's wealth. I've met many families who stuff themselves in cramped apartments because they didn't have enough money or time to buy a house. If you fall in this category, a lease option may be the solution for you. If you're a young professional who would prefer to try out a home for a year before committing to it, a lease option is worth a try.
Leasing a home gives you the future opportunity of homeownership while grooming you for the responsibilities that come with it. Learn how you can contribute to your down payment while renting-to-own by reaching out to Rocena today!
