Rent to Own House

Rent to own house is a proposition that comes good in the financial sense. People may not have saved considerable sum of money to make down payment for buying a house or their credit record may be blemished. 

With rent to own, the renter is required to pay an agreed upon amount as rent per month to live in the house. The end of the contractual period (customarily three years) sees the renter taking possession of the house. This is pulled off by commingling a portion of the down payment with the rent amount each month. 

The process of drawing up the contract should see careful contemplation about the sale price of the house and the rent to be charged, as the amount decided will be locked in for the rest of the term. Any deviation in property value within the contract period will be excluded from consideration. 

The renter has to pay an option fee which is seller’s income if the contemplated purchase fails in future or will become part of the down payment at contract’s end. The rent premium paid by renter is typically the income for seller and is slightly above the stipulated rent.

Free Rent to Own Agreement Contract

Free rent to own agreement contract can be downloaded at one’s convenience from legal sites that post them online. Such contract will have all the relevant points of the agreement clearly drawn out to facilitate easy understanding of the nature of agreement one is going to enter.

Prominently, consensus should be build upon the option fee and rent credit. Option fee is the amount of money the renter is required to shell out over and above the decided rent to claim ownership of the property after the contract expires, which usually is 1 to 3 years. The option consideration usually is 1 to 5% of the agreed upon purchase price of the property. 

Rent credit is the credit made available to the buyer who plays a fair game with the owner. This essentially is important as the rent for property usually is higher than the existing market rates. The option fee is forfeited if the contemplated purchase does not take place. The renter and owner should go through and sign the agreement only after unanimity on all terms of the agreement has been reached.