Renting to Own…to Good to be True?

Owning a home – it’s one of those things that we’re told we should do from early on in life. Home ownership is considered a status symbol that separates the middle class from the poor class. Wikipedia even states that a core pillar of the the American dream is owning property.


This is why even when living in a location where it’s better to rent than buy, many people are insistent on owning a home. Since the housing market bottomed out and loans are difficult to obtain, finding an alternative way to sell or own a home has become a necessity. One option is a “lease to own” contract between a buyer and homeowner. The future buyer will rent the property for a period of time, then have the option to purchase the home at the end the lease.


How it works:


Before moving into a lease to own property, both parties will agree on a sale price and lock it in. The buyer will usually be asked to put down a 3% to 5% non-refundable payment called an option fee.  In most cases the potential buyer pays an inflated monthly rent, with the extra funds going towards the down payment. This gives the potential buyer time to build up the down payment over time while raising their credit score through other means. The rent to own arrangement helps sellers pay the mortgage in a house they may not be able to sell, and lock in their asking price. This seems like a dream come true for homeowners and buyers who may be in a bind. Like everything in life, if it looks to good to be true…it just may be. Let’s take a look at some of the pros and cons of the rent to own home agreements.




If done correctly the rent to own home can be a perfect fit. It helps both the owners and the sellers get the end result they are looking for.


No down payment: Renting to own lets people build up a down payment over time instead of having to come up with the large sum at once that most banks require at signing.


Try before you buy: For the buyers, renting gives the option of living in the house and exploring the neighborhood before locking in a 30 year loan. If they decide they hate the house or location, they can back out after the lease is up.


Broader Market: Homeowners now have a bigger eligibility pool when it comes to buyers. People that previously couldn’t purchase a home can now considered for future ownership.


Locked in price: This can be a plus for either the buyer or the seller. If the value of the home goes up, then the buyer already has a locked in price. If the houses loses value, then the owner won’t have to take the equity hit at the end of the rental lease.




There can be many setbacks when it comes to a lease to own contract for both the buyer and seller.


One mistake could mean losing it all: One late payment to the owner could mean that the contract has been violated and have stiff consequences.


Scams: If the owner of the house ends up losing the house, the buyer is out of a home and the extra money they invested. Homeowners have been known to do lease-option deals fully knowing that the home will be foreclosed on, leaving the buyer homeless and out of any money they invested.


Walking away can hurt: Either the buyer or seller walking away at the end of the lease can be a blow to the wallet. Buyers lose the option fee they placed down along with the rent credit they’ve been building up, while sellers can lose equity if the value of the home has dropped since the potential buyer moved in.


It costs more: Just like traditional rent to own situations, the buyer will pay more in interest fees over time.


Your credit may not cut it: Even after the option fee and inflated rent the buyer pays, renting to own doesn’t actually help their credit score by itself. Buyers may still not be able to get the loan at the end of the lease due to credit issues, and lose their entire investment.


Is it worth it?


In my opinion, renting to own a home is not worth it for the average person. In many cases, the buyer is set up to fail, and the seller usually has the advantage. There are just too many variables that can go wrong in a lease to own situation. The thought of potentially losing out of tens of thousands of dollars because the rent was late once is insane. Owners can lose out too, if the future buyer backs out or disappears the homeowner is stuck with a house that may have less market value. Until that title has been handed over, the person who is looking to buy is still in a renter/landlord relationship. If that relationship goes south, then the rent to buy option may go along with that. As much as lease-ownership situation is perfect in theory for the right folks, people can do bad things and take advantage of the situation. The potential consequences are high for both sides.

In most cases people will be able to find the right mortgage broker and make it work.  If you can’t make the numbers work my advice is to fix your credit, save for a down payment and then go find that dream home. If you can’t afford a home loan don’t burden yourself with higher rent in a desperate attempt to be a homeowner.


If the decision to go through with the rent to own home happens, then go through the motions of actually buying the home. Get home inspections and do other homework on the property. Make sure to find a reputable lawyer write up and look over all contracts before moving in. Rent to own home ownership can be risky, but if done correctly and with the right people, then both sides can walk away happy.




Miami Real Estate Housing Market: Making an Impression Can Lead to Rapid Sales

There is actually an increase of list of homes for sale, in a time when the Miami real estate market is seen of reducing its speed.


Proper pricing is vital but in making a good impression to buyers is an advantage. Excellent first impression can lead to rapid sales. There are some tips to regard as in order to have that excellent impression among buyers and in order to go ahead in the Miami real estate housing selling market.

Let us visit and look at the toilet and bathroom. Now, it is better to make sure that the toilet and bathroom are clean and spot-free. Make sure to remove or eliminate the leaks in the shower, in the sink, tub and toilet. Mirrors should also be clean, it should look shiny. Also make sure that there are no mess on the countertops and shower stalls. And to make the bathroom more striking, you should put clean towels that match the color and style of the bathroom. In this way, the potential buyer will be attracted and will have a good impression with the toilet and bathroom.

Now let us go to the kitchen. Actually the kitchen is the most important selling points in any house in Miami home selling market ever listed. Better to minimized the mess in the kitchen, it is wiser to get rid of the unnecessary things in the kitchen. Is also advisable to eliminate the strange odor in the kitchen, it would be better to clean the curtains and towels before the potential buyer will pay a visit to your home.

Next, it to make the closest looks wider as possible. So better to remove your things and just packed them up. In doing so, you could make the closest look wider and spacious.

Let’s move to the garages and basements. It is wiser to make these look wider and spacious too. So better to put the unused things and tools in the boxes, so not to accumulate all the space in the garages or basements, in doing so, the potential buyer would see the amount of space the basements and garages really has. Actually a messy free garages and basements can give an excellent impression to potential buyers.

Now in terms of the living room, it is more appealing to matches all the decors and design of your living room. Mess should also be removed in and make sue that everything is clean. Remove all the unnecessary things in the room and just leave those furniture and design that could attract the potential buyer. Make sure not to over crowd the room, make it comfortable and pleasant for the buyer, this again will make a great impression to the buyer.

Another place to look up is the bedroom. It is great to leave the furniture behind to make the room more attractive but make sure that it is not again overcrowded. Make sure to make it look wider and spacious. And make sure to put clean bed sheets, blankets and well arranged pillow. Also make sure that the mess is eliminated. In doing all this can make a favorable impression which is needed in selling a home.

An excellent fist impression is very important and needed in making a home sell. So in making sure that the house is clean, mess-free is an advantage. In doing and considering the tips mentioned could works as a competitive advantage in making a rapid sale in Miami real estate housing market.

Article Author Eliza Maledevic from, a SEO Company. Visit Miami Real Estate Websites at &

Article Source:Ezine Articles