Strange-But-True: Rent To Own ?
Just a few days ago, I wrote about how I like odd stories and I highlighted the “Strange-But-True” posts that have appeared on this blog. Now I get the chance to write my own!
In this tumultuous and flooded real estate market, sellers are trying like crazy to attract buyers to their home and devising ways to make it stand out from the crowd. At the same time, troubled banks are unwilling to hand out money very easily and buyers are finding it hard to get loans. As a result, an unusual prospect is emerging to help buyers and sellers alike: rent to own your home.
Okay, so it’s not all that strange of an idea. Lease to own or rent to own has been around forever, but think of the concept for a minute: I’m a prospective first time home buyer, renting a home already. The last thing I want to do is enter another lease agreement. But I don’t know if I’ll be pre-approved for a loan yet, I’m a little nervous.
Like many others, I made some pretty bad financial mistakes when I was in college. Not life-ruining mistakes, but enough that I learned the hard way how not to over-use credit ever again. Though with this goal of a home I’ve been repairing my credit, I don’t actually know if I would qualify yet for a mortgage even in good financial times. I’ll have to buck up soon and find out if I qualify for a mortgage, one way or another. If I find out that rent-to-own is the only way that I could possibly have a house to call my own in the next few years, I would consider it.
The trend of leasing-to-own isn’t just helping out home buyers, though. Home sellers that need to get out and are having a hard time finding a buyer that qualifies for a loan can explore this alternative. Home builders with excess inventories of homes due to the sheer number of homes for sale in Minneapolis, Saint Paul, and the rest of the Twin Cities metro area are also finding it to be an important option. It’s allowing there to be shifts in the real estate market that might not otherwise be there due to the tightening of credit.
Rent to own is something I would do. Something that I wouldn’t do is enter into such an transaction without some sort of representation on my side. A Realtor like the fine team at Barker and Hedges would come in handy or a lawyer that is well-versed in such agreements. Whether you’re renting or buying, you want to make sure that you know what is included in the legally binding contract you will eventually sign.
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