Purchasing a rent to own house in San Antonio will help you buy your dream house, even if you are not quite ready today. In our latest post, we’ll offer advice on what you can expect throughout the procedure so you don’t find yourself stuck with any surprises.
Smart sellers all over the San Antonio region are discovering how selling by means of a rent to own contract can be good for both buyers and sellers. By making use of a rent to own contract, the seller opens the door to all sorts of new prospective buyers. Subsequently, buyers will be able to set down roots, with time to save up and restore their credit score. The risks of a rent to own arrangement are often highlighted, but if all goes as planned, the process can be useful for everyone involved.
How It Works
The terms of a rent to own contract may vary based on what is agreed to by the buyer and seller. Nevertheless, the general procedure is pretty standard. The buyer and seller will enter into an agreement saying the tenant will rent the home for a particular period of time, purchasing the property outright once the lease is up. While any amount of time could be agreed upon, the tenant will usually rent the property for about two years. This permits the buyer time to prepare financially, and get their credit in order if needed. If you are not confident you will have the ability to get this done in the 2 years provided, a rent to own contract isn’t for you. But if you’re confident you will have the ability to purchase at the end of the lease, a rent to own contract might be very beneficial for you in the long run.
Throughout the rental period, the tenant will often pay a higher rent, with some of it going toward the down payment of the house. There will be a payment upfront to guarantee the tenants intent to purchase the house. If they happen to default, the owner will be able to keep the option fee and increased rent paid. If the tenant fulfills their lease obligation, they will subsequently have the ability to buy the house at the predetermined price. The majority of the time, purchase prices are agreed upon before the lease is signed. This can be beneficial for you if the market were to go up before the sale is final.
Pros and Cons
While buying a rent to own home is the perfect solution for a number of buyers, others may experience disappointment in their inability to qualify for a conventional mortgage right now. There are a number of different pros and cons too, including…
- You will have a sense of pride knowing that someday soon, that home will be yours
- You’ll have an opportunity to save money and repair your credit
- You will be able to start putting down roots right away
- You won’t miss out on buying the home of your dreams
- You will build equity instead of just paying rent
- You may be paying higher than average rent
- Something could go wrong with the home after you move in
All in all, using a rent to own agreement to purchase a home in San Antonio could be beneficial to both the seller and buyer. Prior to signing any contracts, make sure all the details are covered. You will want to include contingencies in case something goes majorly wrong with the house. You do not need to be obligated to purchase a house with mold issues or something similar.