Rent to Own Homes in RI

What does it mean to enter into an agreement to rent to own a home in RI? The FIVE STAR Google Rated RI Realtors at Realty Quarters have the answers to all your questions about rent to own homes in RI. Our RI Realtors will guide you through the rent to own a home in RI process and help you decide if rent to own home in RI is right for you. Reach out to our RI Realtors today!

RI Realtors Explain the Concept of Rent to Own Homes in RI

When our RI Realtors talk about traditional homebuying, they are referring to the process of applying for a mortgage through a bank. For example, RI real estate clients A and B currently rent. In order to take advantage of the benefits to buying a house for sale in RI, they want to end their lease and buy a house for sale in RI. RI real estate clients A and B apply for a mortgage online. Within minutes they are preapproved for a $400,000.00 mortgage. RI real estate clients A and B then contact Realty Quarters and schedule their free consultation to begin their real estate journey.

The traditional path to buying a house for sale in RI is not for everyone. Rent to own homes in RI are homes that start out with a rental agreement and end with a purchase agreement. Rent to own a home in RI agreements usually contain time limits. For example, RI real estate clients A and B, due to outstanding credit card debt, do not get approved for a mortgage. However, wanting to buy a house for sale in RI, they speak with their landlord about a rent to own a home in RI agreement. RI real estate clients believe they can pay off their credit card debt in two years. RI real estate clients A and B enter into a rent to own a home in RI agreement that allows them to take ownership after two years, once they are approved for a mortgage.

rent to own homes in ri

What is a Rent to Own Homes in RI Agreement?

When a RI real estate client discusses a rent to own a home in RI agreement, they are asking about an agreement where a renter leases a house for sale in RI for a specific period of time prior to gaining ownership. The period of time is negotiable and usually dependent on the potential buyer’s needs. Depending on the buyer’s needs, the length of time can range from a few months to several years. Unlike a traditional mortgage, the terms of a rent to own a home in RI agreement are usually negotiated by both parties. Rent to own a home in RI agreements generally fall into two categories. The first category is the lease option agreement and the second type of rent to own a home in RI agreement is the lease purchase.

rent to own homes in ri

Characteristics of the Rent to Own a Home in RI Agreement

rent to own homes in ri

The first characteristic of a rent to own homes in RI agreement is that there is a rental period. The second characteristic of the rent to own homes in RI agreement is that the time period is negotiated. The time period of the rent to own homes in RI agreement can be for months or years. Finally, the seller holds a negotiated amount of money from each rent payment towards the buyer’s equity in the house. A general example of the rent to own homes in RI agreement is when RI real estate client A agrees with seller B to sell the home client A rents. RI real estate client A and seller B agree that after four years, seller B will sell the home to client A. During those four years, 20% of client A’s rent will be put toward the equity of the house. At the end of the four years, client A obtains a mortgage for the remaining value of the house.

rent to own homes in ri

Six Key Components of The Rent to Own Homes in RI Agreement

rent to own homes in ri

There are two types of rent to own a home in RI agreements. The first is the lease option agreement and the second is the lease purchase agreement. A lease option rent to own a home in RI agreement is an agreement where the real estate client and seller enter into a contract that concludes with the option to buy the house. By contrast, a lease purchase rent to own a home in RI agreement is an agreement where the real estate client enter into a contract that concludes with the mandatory purchase of the house. Within these two types of rent to own a home in RI agreements, there are six main components. The components are purchase price; rent payments; maintenance; option money; lease term, and closing process. For more information on rent to own agreements, head here.

rent to own homes in ri