are there a lot of american investors doing rent to own???
I don’t know cause I’m from Philippines…
,Red
Yes, rent-to-own has become very popular over the last couple of years for landlords and/or sellers.
It’s popular because 1. it’s a good way to get a couple thousand dollars cash up front from otherwise plain old renters (just being honest here) 2. because its a way to find a buyer for the property, just with a delayed sale, and again, if they don’t follow through on their option, you’ve already made some money on the option fee.
Something I might look into once this lease is up
Rent-to-own is the new trend in the RE industry. Cost effective & contingency based. You can buy it sell it whichever you wish and whenever you want. It just depends on your assessment and decision upon that.
Yes, rent-to-own is very common here in the States and has been popular for years. It is commonly referred to as “Lease Option” as well. Same thing…
To answer your question, yes, Rent to Own (or Lease Option to Purchase) is happening more and more here in the States, particularly because of the down market.
People cannot sell their properties as quickly as they used to so will put in a renter to TRY to handle the mortgage payments. Not only is there usually a non-refundable down payment for the property, but when they sign the Rental Lease Agreement there is usually a slightly higher rent that can be charged for the privilege of potentially owning the home.
Be aware that each state has different laws. In Texas for example if done in the standard fashion if the tenant/buyer does not buy the house a judge can require you to give the money back…that is every payment the tenant/buyer has made to you.
I am a investor in california and Lease Options are a fast way to make fast cash in the real estate business. It’s all about getting the sellers property under contract and bringing in your tentant/buyer with a nice down payment. :bobble
To your success
Make sure you have a good contract if you do rent to owns. Also, don’t put them on 30-year payment schedules! That’s way too long! You can charge 10-12% interest, in many cases, because people who do rent-to-own are usually buyers whose credit is so bad, they could never buy through normal routes. Also, make sure you do interior/exterior checks on the property, to insure your buyers are taking good care of it!