MiamiRealEstateKing

Downturn Makes Rent-to-Own More Appealing

In credit, Home Buyer, home sellers, Industry trends, Lease-Option, Leasing, mortgage, NAR, National, real estate, Sellers, Trends on December 16, 2010 at 8:51 am

December 9, 2010: Downturn Makes Rent-to-Own More Appealing
As the housing downturn continues, rent-to-own contracts are becoming increasingly popular.

Rent-to-own allows buyers time to see if they like the property and time to repair their finances and get a mortgage.

Fritzi Barbour, an associate with Coldwell Banker Caine in Greenville, S.C., says many practitioners are unwilling to recommend a lease-to-own arrangement.

The negatives from a buyer’s standpoint: less flexibility than a rental situation without the permanence of owning and the potential loss of a hefty down payment if the deal doesn’t close.

The down side from the seller’s vantage point: the possibility that the buyers will be unwilling or unable to buy and their presence make a purchase by someone else unlikely. Also, the seller doesn’t get the money right away, nor is there real closure to the deal.

Source: the Wall Street Journal, Sarah Max (12/02/2010)

[Editor’s note: NAR last year hosted a how-to webinar on lease-to-own. The recorded version is available for free access.]

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