Advantages of selling your house in rent with option to buy
If you are a homeowner with a property for sale, a lease to own may be one of your best options. The economy has changed dramatically in recent years. Unemployment has reached all-time highs. Interest rates are low, but that’s not a factor since most homeowners are upside down with their mortgages anyway, thanks to the housing bust. Buyers generally have a harder time getting a traditional mortgage for a number of reasons.
The median home price in some areas is down twenty-five to fifty percent. Home prices have fallen not because of a lack of buyers, but because of a lack of qualified buyers.
Foreclosures and short sales have also reduced home values. Homes are appraised by comparing the median sales price of homes in a specific area that are similar in size, condition, etc. The banks have a surplus of foreclosed houses in all the communities of the country, and their sale price is much cheaper. A regular homeowner can’t compete. This leaves the owner with a property that he cannot sell and, if he does, he gets a fraction of the real value of it. This is when leasing to own becomes an option.
Most lease-to-own companies look for two types of buyers. Relocating buyers tend to be excellent candidates for leases. Relocating buyers are looking to move quickly and start a new job while their old home sells. Most don’t have credit problems, but debt with income disqualifies them for a mortgage. The second type of buyers are high-income customers with some past credit problems.
The advantages for an owner willing to lease-purchase are many. You get the sales price and a nice down payment that you keep whether the buyer exercises their purchase option or not. Another plus, most lease-to-own companies will help buyers improve their credit scores. If buyers are serious about getting financing, their credit scores typically repair themselves at the end of the lease term. The lease period generally does not last more than two years. No commissions or closing costs for the seller is another great incentive. Closing costs are in the thousands. Commissions for real estate agents are around five percent of the sales price of the house. These two factors alone typically save the homeowner $10,000 or more.
National online lease-to-own companies are ideal for sellers and buyers considering leasing as an option. Seventy to eighty percent of all homebuyers look at homes online before visiting a home, as reported by a consumer research agency.
In conclusion, leasing to own is a great option for homeowners selling their property and buyers looking to close quickly. Not all programs are for everyone, so find the best program that meets your particular needs. It should be easy with the large number of companies that provide services in this niche. I hope you have found this useful. Good luck!