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What is a Rent-to-Own?
Simply put, Rent-to-Own is renting with the option to buy. You lease the home from us and then purchase it later at a predetermined date and price. This will give you time to clear up any past credit issues.
How is it different from renting?
The main difference is that the tenant has the option to purchase the home at the end of the rental term. This option is not available for a normal rental.
Who is Rent-to-Own for?
Rent-to-Own programs are beneficial for those who want to own a home but cannot get bank financing. This may be due to bad credit, no credit, new to Canada, divorce, identity theft, bankruptcy, etc. Our program allows the client to get into their home now while they build up their equity and improve their credit at the same time.
What if the house price is higher at time of purchase than what is on the lease?
If the house price happens to be greater than the agreed-upon price when it comes time for our client to purchase the house, the client still has the right to purchase at the agreed-upon price. Any gains in the equity is the client's to keep!
What if the house is worth less at time of purchase than what is on the lease?
If the real estate market has dropped when the lease is up and the home is worth less than was was agreed upon in the contract, a new price can be negotiated, the contract can be extended to allow prices time to recover, as well as a number of other options to satisfy both the buyer and seller.
Will there be a fee?
Yes. There will be a $500 fee once your application is approved and you decide to move forward with shopping for a house. The fee is a pledge of your commitment and will go towards the credit for the purchase of your home.
How much is the initial option payment?
The initial option payment is usually 3-5% of the current price of the home.
How much are the monthly option payments?
The amount of the monthly option payments depends on the amount of the initial option payment and the length of the rental term. The larger the initial payment and the longer the term, the lower the monthly payments and vice versa.
How much option credits will I have when it comes time to purchase the property?
This amount comes down to what was negotiated at the beginning but we aim to have 5-10% of the future purchase price of the home ready in order to qualify the buyer for a CMHC insured mortgage.
Who will be responsible for maintaining the home?
Per the lease option contract, the tenant-buyer will be responsible for all maintenance and repair of the home.