Q: We have a home that we are currently renting to tenants that would like to buy house. Is there a way to change the property to a rent to own property? We recently have had a loss in job, and own the two homes. We would appreciate some good advice.
?Anonymous, Saint Ann, MO
A: Yes, there is a way. I would suggest you get the help of professionals to do it, such as a Realtor and/or an attorney. It is basically a lease with an option to buy, but it is in the details where it can get sticky. The key is to make sure all the laws are followed and all disclosures given as required. This is where the pros come into play.
Adam Aguilar is a Realtor? with Reliantra in West Toluca Lake, CA.
A: Dear Saint Ann, MO
Yes, you can. If you own your property fully and your tenant wants to purchase it over time, you can do a lease purchase agreement in which you have negotiated the purchase amount, determined the lease payments which are more than the current rent payments of which a portion of it will be applied toward the purchase price, and a term in which they will complete the sale. This is also usually down with additional option consideration monies, made non-refundable, and applied toward the purchase price. This provides for a period of time in which you are still receiving rent payments but with the option consideration monies plus the difference over the raised monthly payments accrue the necessary down payment for your tenant to obtain financing from a lender. Another option is for seller financing with either a contract for deed or a trust indenture.
I suggest you contact a professional to assist you. You may want to review this with your CPA and/or attorney.
JoyceM
Joyce Mitchell is a Realtor? with Mitchell & Associates Real Estate in Bigfork, MT.
A: If you tenants are willing, then contact your lawyer and ask him to draft an agreement. I?d suggest that you get a down payment.
Mark Bergman is a Realtor? with Bergman Real Estate in North Creek, NY.
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