If you have bad credit, finding a home to rent or buy can be a challenge. However, rent to own homes may be a viable option for those who want to own a home but have been denied due to their credit score. Learn more about how rent to own works and find options near you.
Buying a home with bad credit can be challenging but not impossible. If you’ve been turned down for homeownership due to a lackluster credit rating or a lack of deposit funds, you’re not alone. And you have options.
Rent to own homes could be the ideal answer, as they allow you to purchase a property over an extended period of time. You don’t have to keep paying a landlord monthly rent and utilities on an apartment that you’ll never own!
Let’s find out why a rent-to-own home could be a dream come true!
What Is a Rent to Own Home?
Rent to own homes are properties that households can rent for extended periods of time. The rent paid is attributed to the total cost of the house.
When the total amount of paid rent equals the home price, the household can claim ownership of the property. But, of course, there are often a few additional fees and costs to consider.
For example, most rent-to-own homes are owned by companies. These businesses direct homebuyers toward their properties and offer low-cost payment plans that result in homeownership.
But these companies may charge minor fees for their services. As such, it’s crucial to consider the additional costs of rent-to-own homes before signing the lease for one. Still, there are several benefits of rent-to-own houses.
Why Choose a Rent to Own House?
Your credit rating and income level can influence your life in nearly limitless ways. For example, according to Forbes, individuals with credit scores lower than 620 might struggle to get a standard mortgage.
Owning your home might feel like an impossible dream if you’re working with lower-than-average credit ratings. That’s why many folks choose rent-to-own homes.
Additionally, some individuals and families might find it challenging to save large amounts of money to put toward a down payment on a home. The standard down payment is about 20% of the total home’s cost.
With the average US home costing slightly more than $200,000, that means you’d need to save $40,000 to cover the initial down payment on a home. But a rent-to-own home could be yours without a down payment.
Still, most households moving into a rent-to-own home pay about 3% of the home’s total cost. This fee is often considered a deposit and is often called an option fee due to its optional nature.
How Does Rent to Own Work?
If you’re considering a rent-to-own property, you’ll want to familiarize yourself with the home-leasing process. Firstly, buyers/renters will need to select a property.
To do this, it’s crucial to consider your budget. Your chosen property’s value will influence your monthly rent amount and the total length of your payment schedule. A property manager can assist you with this.
Once you’ve chosen an attractive and affordable property, you’ll need to come to an agreement about monthly rent payments and maintenance responsibilities. Some owners require renters to manage their own upkeep.
After that, it’s simply a matter of paying the optional deposit, agreeing to a lease term, and signing the final paperwork. Once the house is closed, the renters can move in and enjoy their new home.
Depending on the monthly rent amount and lease agreement, renters can become homeowners in as little as a few years. Even if you have bad credit, you could find yourself owning your own home with a rent-to-own property.
What Should I Look For in a Rent to Own Home?
When searching for the ideal rent-to-own home, it’s crucial to pay close attention to the home seller and any related companies handling the paperwork. You’ll also want to tour the home before signing any papers.
Rent-to-own homes vary widely in size and price. So it’s vital to consider how home prices might change over the coming years before choosing a property. After all, an affordable $200,000 home could go up in price.
If this happens, you may need to adjust your rent payment agreement or lease term agreement. This could end up costing you more money over the long run. Always discuss this possibility with your agent before buying.
It’s also essential to consider your current and future needs when choosing a home. For example, it might be wise to invest in a home with an extra bedroom or two if you’re a growing family.
And if you’re retired or single, a smaller home might be easier to maintain and pay off. Your lifestyle, preferences, and budget can help you select the best possible property. Still, you’ll need to find homes before picking one!
How Can I Find Rent To Own Homes Near Me?
Finding rent-to-own homes near you is often as simple as contacting your local real estate agents. You can also choose to use your favorite search engine to discover rent-to-own homes in your area.
Of course, if you’re a Texas resident (or thinking of moving to Texas), you can always reach out to Homebuyer Creators. Not only could you expedite your home search, but you could find your dream home!
Find Rent to Own Homes in Texas
Are you looking for Rent To Own houses in Texas? If so, you don’t need to look much further than Homebuyer Creators. Our home buying process is streamlined to ensure that every family finds their ideal property.
Remember, you could keep paying monthly rent on an apartment or house you’ll never be able to afford. Or you can invest in rent-to-own homes that could be yours in a matter of a few short years!
If you’re interested in learning more about the rent-to-own home process, please contact us right away! We look forward to answering any questions you may have.