im the seller and someone offered to rent to own and they would buy it after 12 months, i never thought?

Question

of that so what are the benefits and cons of it? Plus can i require money down how much? i dont know anything about this please any info is good info?

THATS WHAT HE SAID THANK YOU FOR REMINDING ME HE SAID "LEASE TO OWN" IS THAT DIFFERENT?

Answer 1

There are benefits and drawbacks. It depends on your situation which will matter most to you. You can structure the contract almost any way you agree on regarding the amount down, how much of the rent will go towards the purchase price, the interest and repayment terms etc. Your initial risks are the same as any mortgage companies, will your purchaser make timely payments, not default the loan or bankrupt on you. Also, will they improve the property and allow it to appreciate as opposed to damage the property and cause it to depreciate. Drawbacks come 1st due to the contract. The mortgage companies have teams of lawyers and years of experience with trial and error in contracts, you don't and really neither does your average local attorney. Seek a WELL qualified real estate contract attorney if you decide on this. Benefit, if your purchaser defaults, the property reverts to you as well as all of the monies paid to date on the contract. If the purchaser remained on the property longer than he made payments you will also be able to persue him for those monies. You must be more vigilent if you sell on private contract, but if you are the sort of person to handle this, and the sort with the means to structure a binding contract to protect you in any event, then this is a perfectly acceptable means to sell your home. In this market, it is also a good option that may mean the difference between selling now and having your property sit for months unsold.

Answer 2

Benefit: you gain income while the home might have otherwise stood empty.

Benefit: the buyer is likely to take better care of the property than a renter would.

Risk: you might miss an opportunity to sell it outright by taking it off the market.

Questions: why can't the buyer get financing now? If their credit or income is so bad that they can't get a mortgage now, they aren't likely to be that much better off in a year.

Some sellers are offering 'lease to own'. You act as the landlord, and collect rent. Some portion (maybe $200 each month) gets credited toward downpayment. This does not mean that you need to put $200 into a bank account and hold it -- it means that when you actually sell it, you give them 'credit' for that much downpayment. ** If they move out before they buy, they do NOT get that downpayment back.

In a lease-to-own, you, as the property owner, still need to pay the taxes, and provide maintenance if the furnace/ plumbing/ roof, etc. go bad. If you don't live in the area, this can be difficult to manage.

Other situations that benefit the seller are 'Land Contracts'.. In this case, you as the seller KEEP the ownership of the property until the buyer COMPLETELY pays it off. You get the tax benefits, and have less risk. If the buyer fails to make payments, you simply evict them and still keep your property. For the buyer, this is VERY risky, because the buyer doesn't get any equity, and if they must move out before reaching the end of the payments, they don't get ANY money back out.

Answer 3

Depends on if u want an investment or just a place to live. My husband and I have purchased 4 houses and 1 townhome to resell as investment properties. Of course u are responsible for all maintenance (unless this is covered by an HOA), taxes, insurance, utilities for the property. Pros-U will have a place u can call your own and if or when u sell it the profit will go to u, You are not throwing your money away on rent every month with nothing to show for it. Cons-$$$ can be expensive if u do not have other resources when issues above come up. Are roomates difficult to find and/or replace where you are located? If not, that should not be an issue if you are used to living with another person Weigh each carefully before you make a decision. Check all comps in the area to see if you could get your investment back or make a profit from resale in the current market. Are home values in your area rising? Is the market in your area saturated with other properties similar to this? Think about what your townhome and surrounding community will have to offer the buyer if they move to your particular area. Insurance cost depends on the purchase price of the condo, area it is located in, and what you want to insure, shop around for quotes. Structure only? Structure and contents? Will a mortgage company hold the note or will the current owner continue to own the property until it is paid off? What would happen to your money if the owner defaults on the mortgage? What ever you decide to do always GET EVERYTHING IN WRITING!! Sadly you just can't take someone's word anymore. I have learned this the hard way. GOOD LUCK!!

Answer 4

I wouldn't do anything like this unless you're desperate to sell, and don't have any other prospects at all. Here's why:

If the buyer is doing this because they can't get financed due to low income or poor credit rating, how do they expect to make the monthly rent?

If they decide at the end of a year that they don't want to buy, you're back in the position that you are in now, except that the house will probably need more maintenance again in order to get it in shape to show and sell. And renters don't tend to take as good of care of a place that isn't their own, so you may have enough damage that it will cost you a fair amount go get it ready to go on the market.

If you wanted to be a landlord, you wouldn't be selling the house - you'd have a "for rent" sign in front of it. Renting a house is essentially a part-time job. If anything breaks, you're responsible for it. If you have a poor tenant, one or two skipped payments can wipe out your year's profit on the house.

Answer 5

The cons is that they move out and don't end up buying it after all, then your left with trying to sell it again. You should still ask for a deposit just in case they move out and the home needs repairs. Make sure you have a lease agreement or contract drawn up that you are happy with before you do it though.

But if you just sell the home you don't have to worry about any of that. Just get it done and over with.

Answer 6

Benefit is you get it sold. YOu can write any agreement you want as a down payment; you can apply some of the rent to purchace. THey can default and leave you stuck, you could die and not be able to convey them property.

Get a real estate atty who is familliar with the concept of a land contract and have it done right.

Answer 7

Consult an attorney to make sure that you have all the proper paperwork and termanology. They can also help to make sure to safeguard. Make sure that it is signed and notarized so that you have a legal document just in case.