September 8th, 2008

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Rent To Buy

When someone hears the terms Rent To Buy the first thing that normally comes to mind is appliance rentals. This has been a very popular service for companies like Radio Rentals and Rent The Roo, just to name a few. But what about Renting to Buy a home. Can this be done?

The answer is a definative YES, and We Buy Homes specialise in helping to setup Rent To Buy deals for both buyers and sellers.

The Rent To Buy method covers various different ways to make a Rent to buy purchase work, so lets cover the three most common ways.

Method one for Rent To Buy is what we call Lease with the Option to purchase. The paperwork to support this method is a normal residential lease agreement and a call option deed. The lease agreement gives you rights to occupy the property and the call option deed gives you control of the asset financially for the term of the agreement. The buyer gets to try before they buy using this rent to buy method.

Method two for Rent To Buy is what we call a vendor financed deposit. The paperwork to support this method is a contract for sale of land, a second mortgage loan agreement and usually, a caveat to protect the title. Using this method, the buyer gets to buy the home using normally mortgage finance, and the vendor (owner) of the property offers vendor finance to fund the buyers deposit. The buyer will normally need clean credit to qualify for this rent to buy method.

Method three for Rent To Buy is what we call a terms contract. The paperwork to support this method is a contract for sale of land and a consumer credit code compliant instalment credit contract. The buyer makes payments to the owner for a period of time that they both agree, so in basic terms, its like a deleyed settlement with regular payments to occupy the property.

So, as you can see, these three Rent To Buy methods can make the prospects of owning your own home much easier then needing to qualify for a home loan under normal circumstances. The We Buy Homes Rent To Buy methods are always treated as an open book policy, so that everyone knows to good and bad points of Rent To Buy before they jump into such a deal.