Rent to Own / Buy Properties
If you have any questions then visit our >> Rent to Own Forum <<<
What is Rent to Own / Buy?
Firstly, Rent to Own and Rent to Buy are the same thing. Rent to Own gives you the right to own your home whilst you are renting as a tenant. Typically you would take on a tenancy from 1 to 3 years, with a contract to purchase the property at a fixed price in the future.
Whilst renting as a tenant it is also possible to have some of your rent allocated to help pay for your deposit on your future mortgage, thus making Rent to Buy an excellent way to get on the property ladder.
What if you have a poor credit history?
With a poor credit history you may not get a mortgage today, but with Rent to Own it does not matter, whilst renting as a tenant you can "repair your credit rating" and then say in 2 or 3 years time take out a mortgage to buy the property you are renting.
What if I have only just arrived in UK?
Rent to Own is an excellent solution to get on the property ladder. Most mortgage companies will not even consider someone who has just arrived in the UK, so by renting as a tenant for a few years you can then apply for a mortgage having been resident and working in the UK
How much deposit do you need?
To get a mortgage in today's market a deposit of 10% or more is often required, but for Rent to Own it is much less. The actual amount required as a deposit will vary but typically it will equate to a few months rent.
The Rent to Own option can also be set up where your initial deposit and part of your monthly rent can be used to save toward your eventual mortgage deposit. Thus after 2 to 3 years of renting you can save enough to cover your mortgage deposit.
What happens if house prices start to rise?
This is one of the great benefits. With Rent to Own you will have a contract to purchase your property at a fixed price in the future. The price is set so that it will be lower than the expected price when you exercise your right to buy. This is best explained by an example:
Initial house value, £150,000 - the current valuation at the time you take out the Right to Buy option
Right to buy price in 3 years time £150,000 - this is the price you have the right to buy at, say after 3 years (can vary)
Estimated house value in 3 years time £165,000, and you will be buying at just £150,000, an instant £15,000 gain
Please note this is just an example, specific details would be agreed with, your advisor, the vendor and solicitors.
Want to know more about Rent to Own?
Most people will have questions ranging from how to find a "Rent to Own property" through to finding a solicitor to handle all of the legal work. To help with this we launched on 10 May 2009 a dedicated forum for Rent to Own, here you can ask questions, read answers to other questions, and generally learn more about how you can make the transition from tenant to owner. The moderators in our forum are very helpful and will endeavor to answer any questions that you may have.
You can also advertise for free (launched 20 July 2009) to find a rent to own property, just go to our Rent to Own/Buy forum and post in the "find a rent to own property" section.
You can also send us your details and we will email you when we find a matching property. Enter your details here
We recommend that you visit our forum, its a great place to learn about Rent to Own and also to find a property.