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Glimpse on Lease to Own Investing

March 29th, 2012 · No Comments

A real estate investment which is gaining popularity for buyers is the lease to own industry. The lease to own market is an excellent method for people to buy real estate investment.

Lease to own investing is comparable to renting. Renters make a payment on monthly basis to the landlord for as long as the rent or contract says. Even so, portion of that monthly payment is going toward the down payment of the home. At the conclusion of the stated period in the deal, the renter has the alternative of buying the residence.

Lease-to-own is an option in case you have experienced house foreclosures or that don’t have a large enough down payment. Furthermore, it is a less risky way of investing in real estate. An investor already possesses a capable client arranged and can still get income from the house until the lease is up.

You should have a deal written between the renter and yourself should you opt for this type of real estate investment. Some of the things to put in the agreement will be what amount of the payment shall be credited on the down payment, when the rental period ends and the agreed upon buying price.

The deal must also point out what will happen to the credited down payment when the tenant prefers not to purchase the home when it’s time. The lease-to-own choice is not a duty to purchase for the tenant. It’s quite common for the renter to forfeit the paid total when they decide not to buy.

There are plenty of other advantages to this method of real estate investment in Reno. There is no commission that should be given to a real estate broker following the transaction. You’ve got cash coming in on a monthly basis and a good chance of doubling your real estate investment in five years should the agreement is really structured properly.

Nevertheless, there are several pitfalls you should be mindful of, specifically when you are considering negotiating other issues in the contract. You and the renter should establish who covers the cost for any taxes, insurance as well as any repair fees during the time of the lease. Inspection reports, settlement costs and appraisals need to be addressed if your renter actually purchase your house.

Lease-to-own is another solution for those who are wanting to become a homeowner. It is critical for you to do your investigation and also a testing process for possible renters. Working out a contract for this kind of investment can be tricky, therefore it is essential to seek guidance when needed to guard and optimize your investment.




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