The Pros And Cons Of Borrowing From A Bank To Pay For A Rent To Own Home

There are so many unique and creative financing options for those who really want to buy a home. Even if you have bad credit, there are options out there available to you. If you are looking at the rent to own financing option to purchase a home for sale, then this article will offer you several benefits.

This article will cover the topic of borrowing directly from banks in order to obtain a mortgage loan required to make the final purchase on the home once the rent to own financing contract has run its course on the renting portion of the contract. You will be given a list of pros and cons which should allow you to better decide whether to borrow directly from a bank, use a mortgage broker or lend directly from the homeowner.

Pros

Reliability: There are not many financial institutions that are more reliable than banks. You may chuckle under your breath considering the past few years filled with bank bailouts end near runs on these lending institutions, but federally insured... to continue reading click here.

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Preparing For A Rent To Own Contract

If you decide to use the rent to own financing option to purchase your home, it is important that you prepare yourself for the reality of the situation. Knowing exactly what you are getting yourself into is key, particularly when legal contracts are signed and you become liable for certain financial aspects of the contract.

This article will run you through the basics of determining whether or not you are qualified for a future loan before you enter into a rent to own contract. Since the goal of a rent to own contract is to give yourself some time to get your expenses in order before purchasing a home, you should have a plan on how you are going to save that money to purchase the home.

The Ball Is In Your Court

Ultimately, only you can determine what kind of home you can afford and how much you want the monthly payments to be. Sit down with your significant other (or if you’re by yourself) collect all of your income and debt statements. It will be important to know exactly how much you make on a regular basis and exactly what your current debts are.

One of the most common mistakes that people make... to read the full article click here.

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What Closing Costs Can I Expect In A Rent To Own Contract?

One of the interesting things about the rent to own financing option is that it is often home owner financed. Meaning, in many cases the bank plays no role other than administrator in the entire financing of the home. While this article will outline some of the basic closing costs associated with the typical rent to own contract, it is important to be aware that the home seller can create closing costs of their own.

Budgeting for closing costs is incredibly important because closing costs can account for up to 8% of the total property. If you are going to be using the rent to own finance option to buy yourself some time to save up money or to repair your credit, don’t forget to factor in that extra 8% in order to close the deal.

Here are some of the major closing costs:

Escrow fees: Escrow fees are basically the paperwork fees. These fees cover all of the home purchase related documents and funds. Typically escrow fees are several hundred dollars and are based entirely on the purchase price of your home.

Title insurance: Title insurance is incredibly important in the rent to own situation. Why? Because title insurance... to read the full article click here.

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How To Make A Decision On Your Down Payment In A Rent To Own Situation

For rent to own homes for sale, there are many unique challenges and opportunities in financing the actual purchase of the home. One of those unique opportunities is the ability to include a down payment in a monthly rent credit fee paid over a long period of time. In other words, you can actually stretch out the down payment over the length of the contract in part or in full.

The major reason that people borrow money, whether it is for a car or for rent to own homes, is simply because they cannot currently afford the lump sum value of the home but still want to make that purchase. For many who involve themselves in a rent to own financing option, this is taken a step further.

As discussed in many of the other articles within this site, the rent to own finance option allows you to lengthen that time required before making a down payment or making a full commitment on the house.

One of the major decisions in purchasing a home, whether using the rent to own homes for sale model of financing or... to read the full article click here.

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Do I Need A Mortgage Broker For A Rent To Own Contract?

If you are considering the rent to own homes financing option, you may be confused as to how this process differs from a traditional mortgage. While it can seem confusing at first, this article will teach you more about mortgage brokers and the role they play in rent to own contracts.

If you are like many considering rent to own homes, you may be in a position in your life where you need the extra time to either save the money, repair your credit or you just want to test out the home before you purchase it. The rent to own option does allow you to take advantage of a “try before you buy” type situation. At the end of the day however, you will have to decide after your contract is up whether or not you wish to purchase the home.

If you have been saving your money, repairing your credit and examining whether or not you want to purchase the home then you should be at a point where you are ready to actually make the purchase of a home.

To Do This There Are Two Main Options

The first option is to deal with a mortgage broker and the second option is to deal with the homeowner directly. Each option has its own benefits and things to watch out for, but we will focus on working with mortgage brokers in this article.

Mortgage brokers are essentially...to read the full article please click here.

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