Browse Rent To Own Homes in Richmond, KY
Are you looking for a rent to own house in Richmond? If so, then browse the featured listings on this page, or signup to access our complete guide and listings for all lease to own properties in the Richmond area.
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Featured Rent To Buy Houses in Richmond, Kentucky
Browse the following featured properties in the Richmond, Kentucky area, or click the link on this page to get access to the complete listings for Richmond rent to own houses.
How Rent To Own Real Estate Works
Also known as a lease option, rent to buy homes are a type of owner financing tor real estate properties.
While the terms of the agreements can vary from house to house, the typical scenario is one in which the owner is looking to sell the property but is willing to accept payment over a period of time, rather than an up front settlement.
In this case, the buyer and seller both agree on the selling price of the home, and the terms of the purchase agreement, specifying things such as payment terms, interest, and length of the agreement.
Usually, owner-financed properties are paid off much sooner than a traditional bank mortgage, but by allowing the renter time to accrue equity in the house, the renter can often roll over that equity into a traditional mortgage after 1-3 years, if the need arises.
Every month the renter/buyer makes a payment to the seller. Typically, part of this payment is credited as rent, while a second part is credited towards the interest on the loan and/or equity in the home. Over time, the renter can then buy out the seller, even if the renter didn’t originally have a large downpayment or the credit needed to qualify for a traditional mortgage.
Richmond Lease Purchase Homes and Houses
While there are many advantages to lease option, or lease to purchase homes, one of the main difficulties can be in locating the currently available properties.
Many rent to own listings are never uploaded to national or local databases, since it is common for sellers to work independently and not go through a real estate agent for these transactions. It is also common for sellers of owner financed, rent to buy properties to sell their homes casually, meaning that they are interested in selling, but are in no hurry to do so, meaning the listings are not widely publicized.
To find the full list of rent to buy properties in your area, you need to sign up for a dedicated listing service, which works to identify all of the relevant opportunities within your target geographical area.
Without a reputable listing agency, finding these properties can be extremely difficult!
Sign up below to get access to one of the most comprehensive rent to own listing services in the country.
Listings for Rent To Buy Properties in Richmond, Kentucky
If you think rent-to-own is the only path that you can take for you to become a homeowner, we are here to tell you that the Internet is the worst place to find properties for rent-to-own.
We searched for ìRichmond KY rent to own homesî on Google and were disappointed to find that the websites at the top of the search results yielded no results at all. This leads us to a very important point: If you are keen on finding a rent-to-own property, make sure you work with a brick-and-mortar real estate broker who can connect you with a lender that specializes in rental arrangements with the option to buy, which is what a rent-to-own arrangement really is. Or you could search online for rent-to-own lenders based in Richmond. Either way works. What is important is that you understand how it all works.
A rent-to-own arrangement just makes you the preferred buyer of the property that you are renting. But this status of preferred buyer comes at a price as you need to pay an option fee (usually $2,000 to $4,000), which in most cases is non-refundable if you opt to back out and decide not to buy the property you are renting. But if you do proceed with the purchase, the money will be returned to you for use in the sale, or it could be deducted from the sale price.
If you pay $1,000 per month in rent, not all of it will be used to deduct from the purchase price. In fact, only a small portion of it will be. Most lenders only allow $200 of the rental amount for the buying transaction. In Richmond though, rental rates are much lower than $1,000.
All in all, a rent-to-own arrangement does sound like you are wasting two to five years in rental and only saving a small amount for the purchase. This is mainly the reason why most people who buy homes under a rent-to-own arrangement are typically people who have checkered credit scores and have been rejected for home loans by the banks.
Still, rent-to-own is still a win-win situation because it allows the tenant-future owners to test the property before buying. For the property owners, it frees them from the cost of maintenance since most occupants are keener on maintaining the property than the average tenant.