Katherine Peters
Katherine Peters
Looking to Rent
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3 years ago
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Are these rent to own opportunities a scam or the real deal? How do they work?

My husband and I are looking to get out of our apartment and rent a home. We plan on buying a house in 3 years when our debt consolidation is done and our credit is back on track. I have seen some of these rent to own ads saying bad credit doesn't matter. How do you rent to own and is it a good deal?
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Glen Fullmer
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3 years ago
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While agreeing with all the previous comments that it is important to know who you are dealing with, it can be a great deal for people that:

1. Know they are going to buy the place.
2. Currently can't qualify for a loan as payments will probably be bigger.
3. Find Rent-to-Own deals will giving credit towards purchase.
4. Find landlords who provide longer term deals (5 years).
5. Find landlords who provide low option consideration (down payment) at 3-5%.

There will be larger payments than purchase price but the equity buildup is usually larger than the land principle buy down for the first couple of years if the landlord is giving a rent credit towards purchase. If all above conditions apply then it is usually a win-win for both parties.

As a landlord, I have been providing lease options (rent-to-own) deals for almost a decade for a number of people getting their credit in order so they can purchase the place. However, make sure you have good references for the landlord, or company doing the deal and you know that you won't be moving before the purchase.

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Erna Sigurdsson, Realtor
Erna Sigurdsson, Realtor
Real Estate Professional
39 Likes
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3 years ago
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There are some legitimate Rent to Own opportunities out there. I would recommend having a Real Estate agent or a lawyer draw up the contract for it, if it is directly through the owner of the property definetly have a lawyer draw up the paperwork. There is usually a much larger down payment for rent to own and you may even be able to get Owners financing, therefore bad credit may be ok. Hope that helps.

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Eileen O'Brien
Eileen O'Brien
Real Estate Professional
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2 years ago
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Rent a home, if that's what you want. There are many to choose from. You don't need to "rent to own". Leave the headaches to the landlord for now, and focus on getting your credit back on track. Then you can buy a home without the extra cost. Ownership feels good, but it is expensive.

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29 Likes
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2 years ago
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Rent to Own is a way to suck the life out of people that are already down. Dont do it. If you cant get a mortgage at the end of rental agreement..by by money. The point is some ppl will never fix their credit to get a mortgage because they have legitimate reasons why its poor..like not paying something they shouldnt have to pay for

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Lynn Shepodd
Lynn Shepodd
Real Estate Professional
23 Likes
1 Replies
2 years ago
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If you have good credit, buy a home in as good a hood as possible. There are very good options for lower than 20% down.

If your credit still needs more time to right itself, or you move often for work, stick with renting. And be sure to have an agent represent you (that's free) so you can determine up front that the house you are about to rent is not about to be foreclosed. There are scammers that take deposits and off they go.

I don't trust rent to own. You can't tell what you are signing. Best of luck.
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1 year ago
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My credit is shakey, but I feel they haven't any right to foreclose in on me...df , dayton, ohio

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2 years ago
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I know this is an old question but wanted to put in my two cents. Rent to own deals are great when the market is improving and you are unable to purchase today. Usually you have to provide some type of option money to be able to purchase the home at a latter date. Option money varies but somewhere in the neighborhood of 2% is fairly common. Then you can purchase at contract specified times. Says years 2,3 and 5. You agree on the price today, and with the market going down you won't have equity in the property making financing more difficult. Rent to own can be viable in a market that is increasing, but a bad idea in a market that goes down. If you time it right and get the option when we hit bottom you'll do very well. Personally I believe it's a bit risky and you should work on improving your credit and buy when you are able.

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12 Likes
3 Replies
2 years ago
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its a scam because i live in this house and some guy from Kenia decided to put on Craigslist that our house is for rent its not its for sale you can tell by how the guy talkes hes been saying hes my dad but hes not so now people think the house is empty so people just walk right in or look through my window. Im 17 years old i dont want ANYONE looking through my window, sorry but its for sale and whatever he told you its a lie except it is a pretty home and i have no clue how he got the pictures of the house but those pictures are really the house.
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1 year ago
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So 115 Hancock is not for rent? I thought so cuz when i inquired about it i got an email with an application attached and they said to send deposit and if approved they will send me the keys and if not approved they will refund deposit..yeah right? what do they think im an idiot. But i was thinking maybe stolen from a local realtor....but now i see its not for rent at all..thankyou:)

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1 year ago
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That same guy from Kenya has a scheme going on, taking people's actual houses for rent or sale and marketing them at a lower rate. Then asks you to wire him the money thru money gram. He pretends to be Mr. And Mrs. Johnson saying he moved to Texas to do missionary work, saying he's a man of God. He's a liar and a crook. Some king of way whenever you reply to a listing via email to receive information about a property, he intercepts it and reply using the same lame story, and same so called rental application question. He had me go to someone's house and peek thru the Window thinking it was unoccupied. Please DO NOT fall for his scam, and if u market your house to be sold or rented out BEWARE OF THIS MAN. He will make potential occupants believe it's all a scam, slowing down your progress.

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1 Like
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1 year ago
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weve talked to this man on the phone. Is the property on 17436 Eucalyptus Street
Fontana, CA 92337 even for rent? i have a wife and a brand new baby and this man is bugging us for the deposit. can you contact me please a.s.a.p. 909-697-6682. thank you.

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Ed Drummond
Ed Drummond
Real Estate Professional
11 Likes
0 Replies
2 years ago
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I think Glenn's answer summed it up best. In the Phoenix metro area we are only just beginning to see the lease-purchase reemerge as investors decide to buy and hold vs. flip. Lease options can be a great deal for both parties, tenants and landlords, but tenant beware, in my experience odds are against you that you will ride out the term of your agreement and exercise your option to buy.

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Rebecca Crouch
Browsing Housing
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2 years ago
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We saved $5,000 and put it down on a home that was rent to own. We went with a company out of Charlotte Va called Buy rent to own homes LLC they have a web site if you want to check it out. They made it easy and in 18 months we had a credit counselor we paid 2,500 thru them that got our credit score up from 500 to 700 intime to assume our own loan and they had a lady for that too!!

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Kent Simpson
Kent Simpson
Real Estate Professional
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3 years ago
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I recommend being extremely careful when considering a rent-to-own opportunity. In the past few years, the Arizona Real Estate Commissioner has had to deal with a growing number of issues related to this type of transaction...including many involving the Attorney General for prosecution.

There ARE good rent-to-own opportunities out there, but also many scams. Be very cautious and explore all of the options available to you with the help of an experienced, licensed real estate professional work on your behalf.

Through your local housing authority there may be some programs available to help-even with down payment assistance if you qualify! It may turn out that waiting for a regular purchase could be to your advantage, it could not - but you don't have to go through the decision without guidance.

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2 years ago
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I recommend that you ask the owner for the loan number and lenders information to make sure there is no foreclosure status in place first. You want to make sure you can always be able to check on this on a monthly basis or when you want. Also work with a license property management/realtor and check the DRE website to make sure they are up to date on their license too. There are also cases of bad realtors renting out properties with no property management contracts and been caught and put in prison for fraud. There are alot of scams out there so be very careful. Anyway, if you do decide to do something like this, make sure they note in the lease agreement how much is going towards the future down payment of the sale out of the rental agreement funds and give you a date when you can expect to purchase the home when your credit is good again. Good Luck...

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3 Likes
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3 years ago
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Well there are a lot of scams on the internet these days. All I can say is research, research and more research. People who are serious about renting, corporate renting,etc. will be tracking their properties very closely. Had several calls to our renters about cleaning the property when they leave, etc. all scams. Go back to the original owner and do the research.
thanks
tony

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3 Likes
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2 years ago
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Contract for deed, is when you are out on a sales contract and then obligated to buy home for a certain amount of time, but you have to pay own repairs fines and anything that is obligated to that home while buying it, u dont go to finance company unlss you are ready for a mortgage all payments are then sent to owner or title holder.
I had recieved a home and placed it under contract for deed, if they have issue paying and fall behind i can give them up to 60 days to get from the rear and to pay up all owed or they can return home to me with out recieving any thing from me or get it placed on thier credit report. I am looking to purchase 23 more homes before my 50th bday..,lol it will be soon .

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Ruthie Smith
Browsing Housing
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2 years ago
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My Husband and I live in a rent to own home, we have a nice home with a two car garage and a two story guest house on 3 acres of land. We watched the house stay and stay on the market and there was a real estate sign in the yard and the realtor gave us the owners name and phone number, we contacted him, he contacted his attorney and we have been living here for more than a year. Always make sure that there is an Attoney involved at the owners expense. This is the second house we bought rent to own and the good thing about it, if you are not happy there, you can give your 30 day notice and move on.

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johanna r
Browsing Housing
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1 year ago
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oh god, dont do it!We had a shortsale almost 3 years ago and moved to Norch Carolina from NJ. We have reaired our credit, but HATE our neighbors (one is a crazy ##### and the other shoots guns and firearms off at 3 am behind us). Of course, nobody told us that one before we moved in..not even the stuid neighbors I interviewed! We were desesperate, its a pretty nice house, but not for us. The schools here are terrible too! Long story short, we got screwed! We are loosing $10,000 that we put down if we dont buy. So if we cant get a mortgage at the 3 year mark (via FHA guidelines) we r just going to rent somewhere else anyway. Save your money,fix your credit, and dont let some rich greedy landlord that acts like he's doing u a favor fool u. He's in it for himspef and if you change ur mind, hes the winner and ur the loser! Lesson Learned!!!!

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2 Likes
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2 years ago
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Does anyone have a Due Diligence checklist for the tenant / prospective owner?
I think with your experience that would be of value. I am in the renovation and resale business and would like to be able to offer lease options but of course, only if win-win. My goal is to produce cooperative businesses in which the investor/employee reaps the benefits they deserve. Lease option is close so also has my keen interest.
Great question and post Katherine and all.

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2 years ago
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my husband and i have been renting our whole lives and have a great rental track record but we never established any credit so our credit seems not up to the "buying standards" i was wondering if anyone knew of any lease purchase or rent to own information that would be beneficial to me in my search. i am located in pennsylvania in the bucks county area? any information would be greatly appreciated!

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Gerry Moore
Browsing Housing
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2 years ago
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Be Honest with your credit situation up front.

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1 Like
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2 years ago
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There are some good people who can offer you a rent to own program. The Key is to put down a small deposit and make sure the morgate that you pay is less that the rent in that area. While your paying make sure you work on fixing your credit, to get a better rate.

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1 year ago
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My wife and I are purchasing another home. My current home is being handled by Atlas as a lease to own property. They appear to be very professional and handle all of the paper work involved.

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monique auguste
Browsing Housing
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1 year ago
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Hello my name is monique. I moving to the fort lauderdale area this summer coming from nj. I was thinking about rent to own, but was little scary about it, after i read these comments, i am thinking of doing it. Any one knows a reliable realtor down florida agency who handle rent to own, or a reliable websites to start. Someone told me about owner wiz websites. Needs some help please. I moving by august 1 st. Your help will be greatly appreciated. thank you

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Cathy Hue
Browsing Housing
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1 year ago
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Rent to own is definitely a great deal when you are short on money and low on your credit score. It gives you enough time to build on your credit ratings and firm up your cash reserves. I am yet to hear about a scam in rent to own, there could be a downside though that house owner fails to pay the original mortgage and the property gets foreclosed, in this scenario you end up lose not only your house but also option money. So be cautious before going for it. Read more about rent to own here, http://www.homestarsearch.com/when-to-rent-to-own

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D. Mazyck
Home Seller
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2 years ago
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All rent to own programs aren't created the same, with that being said. Just make sure that whoever you go through for a rent to own, has everything legit because your objective would be to actually purchase the home at the end of the term. One person said use an agent to draw up your rent to own agreements, the fact is that most agents don't really know how the rent to own works.

There are a few governmental programs that you can combine with rent to owning that will improve your chances of finally being able to purchase the home. Most of the success of a rent to own is on the tenant buyers and their discipline to improve their credit in the time allocated.

We also provide rent to owns, but right now we are not in your area for the rent to own but those that are in Charlotte and are interested go to http://www.charlottesbargainhouses.com.

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2 years ago
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Hi Katherine. I think there can be good and bad out there for sure. One must be careful. I do have a house rental or room rental situation available if you are still looking do contact me~ Cheers Randy

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2 years ago
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Hello,

I would not do a lease to purchase as most never happen for all kind of reasons. If you can qualify for a mortgage, then you should do that now as the market conditions are all in favor of the buyer!

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2 years ago
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can someone please tell me. how do you find a nice townhouse in lancaster for rent. we sold our home, and settlement is in oct. need a nice place for long-term residence. thax

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2 years ago
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The Laws in Texas have recently been changed where everything must go through a lawyer making it much more expensive for the landlord to rent the properties as rent to buy. Most landlords will not go through the trouble now that the tables are turned toward the purchasers favor than the outrageous interest rates, and sudden take overs of the home for late payments. Most landlords that rent to buy will not allow one late payment before repossessing it.

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2 years ago
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With the onslaught of foreclosed property, banks and owners of property are looking to recover costs. However, rent to own has been around for years. You may be able to get a deal with little or no up front money. It could be a very good deal, but always remember to READ THE FINE PRINT. Hire a lawyer or get someone to help you so you know what you are getting yourself into. Make sure it is something you can afford and have a little extra money to fall back on if something happens. Know what the consequences are if you miss a payment. Everything should be spelled out for you in your contract. Do not do anything by verbal agreement. Get a contract.

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