Rent to Own... is it right for you?

Real Estate Broker/Owner with Charles Stallions Real Estate Services

With the mortgage crisis the way it is, the tightening of money from lenders or lack of money to loan. I get a lot of calls from buyers wanting to know if rent to own is an option. The short answer is maybe...   Some ways to tell.   If you apply for a loan and the interest rates puts the payments above what a similar home is on a rent to own home, then a rent to own home is for you. If you have credit issues that would prevent you from getting a loan then a rent to own could be for you.  

 Things to make sure you do.

  1. When agreeing to a rent to own you will want to make sure you make the payments to the lender and not depend on the seller.
  2. Make sure you put some kind of notice or recording with the courts that you have an interest in the property. Partly because you do not want the owner to be able to get a second mortgage or another loan on the home that would effect the contract. Whatever is proper in your state.
  3. You will always want to do a title search so as to not have any surprises, Do not try to save money here. Next to the wording of the contract this is probably the most important thing.
  4. Make sure to put in the contract that the seller is to not cause or seek a loan of any type after the contract date.
  5. You will want the seller to furnish a home warranty.
  6. There should be a dropdead date with a signed earnest money contract that defines how much of your rent applies to the pre-defined purchase price.

Things to make sure you don't do.

  1. Do not buy a home with an adjustable rate mortgage.
  2. Do not buy a home if any party says you do not need a title search at this time.
  3. Do not buy without the advise of a Realtor, there are numerous horror stories where the wording became a conflict and each party read something different when issues arived.

Rent to own can be a wonderful thing and works very well as long as you know what it is going in. Make sure what you agree to is in writing. There is no such thing as too much writing when it comes to understanding a contract.


Re-Blogged 2 times:

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Jennifer Monroe
Savvy + Company Real Estate - Charlotte, NC
Real Estate REALTOR®/Broker in Beautiful Charlotte

Very well done... I especially caution people in any state against doing this without a Realtor. There should be a dropdead date with a signed earnest money contract that defines how much of your rent applies to the pre-defined purchase price. In my state, the only 'rent' that applies is any amount over standard 'market rent'. I think the number one reson these transactions fail and renters/purchasers get burned is because of undefined surprises.

Nice to meet you by the way :)

Oct 04, 2008 04:36 AM #1
Charles Stallions
Charles Stallions Real Estate Services - Pensacola, FL
800-309-3414 - Pensacola, Pace or Gulf Breeze, Fl.

Thanks Jennifer and you are so right. I am going to add.

Oct 04, 2008 09:53 AM #2
delete account
Clayton, MO

Hi Charles. Great information here!! I have just recently received a lot of phone calls about lease to purchase because of credit ratings and people do need to know what to look for. I agree with Jennifer when she says they shouldn't do things without a realtor. We ran into some shady people while I was helping two clients find homes. Consumers need to be better informed.

Oct 05, 2008 06:40 AM #3
Charles Stallions Real Estate Services
Charles Stallions Real Estate Services Inc - Gulf Breeze, FL
Buyers Agent 800-309-3414 Pace and Gulf Breeze,Fl.

RTO is a great way to buy if you are rebuilding your credit and then you can refinance at that time

Feb 19, 2012 10:28 AM #4
Charles Stallions Property Manager
Charles Stallions Real Estate Services - Pace, FL
Pensacola, Pace & Gulf Breeze Property Management

Renting in Pensacola, Pace or Gulf Breeze and Home for Rent is as simple as contacting one of our property management experts. We would love to earn your business and WOW you with our services. Regardless of price we treat you with total respect as to what you want not a home that we need to rent. We want you to get a rental that you can call HOME.

Renters are taking advantage of our Smooth Move Program, Choose between Free use of our Moving Van or a $25 or Gift Certificate. Be sure to ask about FREE Rent. Pensacola, Pace and Gulf Breeze Homes for Rent



Are you paying too much in Property Management Fees? Are you going broke with maintenance fees, low rents, lack of tenants etc? We charge a Flat Fee of $50. a month which includes monthly reconciliation statement, tenant screening, property inspections, we do low cost preventive maintenance saving owners thousands. We save owners 75% over other property managers. Bottom Line is WE make you MONEY. Call Michelle - 800-309-3414 - Charles Stallions Real Estate Services Inc.

Property Management for $50 Flat fee monthly


Apr 10, 2012 12:27 PM #5
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Charles Stallions

800-309-3414 - Pensacola, Pace or Gulf Breeze, Fl.
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