In real estate, Rent to Own is a term used when an owner decides that he may rent the property and give the option to the renter to purchase the property at a fixed price or within a specified amount of time in the future. Both the renter and owner should have a written agreement. The agreement is may also be known as a lease to purchase option. It is a term that has been around for many years, but in todayâ€™s market, it is getting to be more common. Property owners are realizing that putting a qualified renter and giving the renter the option to purchase often times results in a win-win situation for both the property owner and the renter. The rent to own term can be used for a house, commercial property or even a rent to own condo.
In most instances, a rent to own condo lease is a typical residential lease. The land owner, known as the lessor, permits the lessee to occupy the property in exchange for monthly rent. The option to purchase the property often times is an addendum to the residential lease. The addendum may state the price and the period of time in which the lessee may purchase the property.
Another advantage is sometimes the lessor and the lessee agree that a portion of the monthly rent payments may be used to reduce the purchase price of the property or may be used as a down payment on the purchase of the property. If the lessee does not purchase the property the portion of the monthly rent that is agreed on is NOT returned to the lessee and in fact stays with the lessor. The rent to own option also may allow additional time to save for a down payment or time to rebuild the lesseeâ€™s credit if needed.
In todayâ€™s economy, the rent to own condo has many advantages to both the property owner and the renter. The advantages often times outweigh the disadvantages. Additionally, if the renter is a first time homebuyer, and they purchase the property in 2009, they may be able to take advantage of the $8,000 First-Time homebuyers Tax Credit on their 2009 Tax Return, which is 10% of the purchase price of the home up to $8,000.
At OwnACondo.com our condo specialists understand the process and will help you in finding a rent to own condo.