Looking For Homes For Rent to Own? Here Are Things to Consider!

If you are looking for homes for rent to own, chances are you are not in a situation currently that allows you to qualify for traditional financing. Perhaps you are self employed and unable to provide the underwriters with two years tax returns that verifies your income. Even more likely is that your credit score is not strong enough to get a mortgage now that the guidelines have tightened up so much.

Whatever your reasoning, getting a rent to own home can be a great step towards a positive future. But, there are some things you should consider as you go through the process.

First – make sure you are really motivated. Statistics show that most tenant buyers who enter into rent to own contracts never actually end up purchasing the home. Most often, the reason is that they were not serious enough and therefore did not take action to immediately begin fixing their financial situation.

Let’s face it – credit repair isn’t a fun process. Very often, you need cash to pay off old collections and pay down credit card debt. This takes disciple and hard work and, unfortunately, most of us are more interested in pleasure today. If you doubt your resolve to correct your financial situation, then you should probably consider renting until a time in which you feel more motivation. It simply doesn’t make sense to pay an upfront option fee of between 2% and 5% of the home’s value if it is not going to help you in achieving your goals.

You also need to make sure that the current home owner is really serious about selling you the home and not just more interested in having a renter who is willing to pay them an upfront fee.

While most home owners do want to eventually sell, there are some who advertise their homes for rent to own simply because they like collecting option fees. They then structure the contract in a manner that does not give you the opportunity to purchase the home. Typically, this involves a very short term (less than two years) so that you do not have the opportunity to repair your credit. Alternatively, they may set the purchase price so high that you are not able to get a loan because the appraisal will not be accepted by the bank.

By making sure that everyone has the same goals, a rent to own contract can create a win-win for both the tenant buyer and the home seller.

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3 Simple Ways to Cover Your Risks Before Putting Your Home for Rent

Last year I gave my home for rent and moved out of state. The rental agreement clearly required the renters to have renters insurance for their property. The house was recently burglarized and the home was damaged. Can the renters file a claim against my homeowner’s policy? Which insurance will pay to repair the damage to the home?

Putting your home for rent significantly increases your risks. Make sure you are adequately covered. Start with these 3 simple steps.

  1. Get landlord’s insurance policy. Homeowner’s insurance policy does not offer the protection if you are renting out your home. HO policy is designed for homes occupied by the owner. Renting out increases risks significantly. A landlord’s insurance policy should be in place before renting out your home. The coverage is not as broad and the rates are steeper. However if you don’t have the right coverage you will be out of luck when something bad happens.
  2. Get umbrella liability protection. Besides house and structures that belong to the owner, landlord’s insurance covers all of owner’s possessions, loss of rental income and liability in case there is an injury or lawsuit. It is always advisable to have an umbrella policy for additional liability protection.
  3. Require renters insurance with sufficient liability. Landlord’s insurance does not cover renter’s property. It is a good precaution to require renters insurance. You should also require sufficient liability protection in renters insurance. In case the renter damages the home you can sue the renter and recover your damages from their insurance company.

In this case your renters can not file a claim on your homeowner’s policy. If you had a landlord’s insurance, it would have covered the damage to home. However you may have tough time recovering it from your HO policy. If the damage was caused by the renter’s negligence then you may be able to recover from the renter’s policy.

If you have to file home insurance claim, please visit http://www.ReClaimsInc.com/can-reclaims-help-you for an excellent free tool that helps you find out whether you got full settlement in 5 minutes of less. You will find additional insights into home insurance claims. You can also ask an expert any questions about your home insurance claim.

Settling In To a New Home for Rent and Neighborhood

You can enjoy a wonderful time in a home for rent. You do have a responsibility to ensure that the lease agreement is in place, and that you make regular payments. Explore the new neighborhood and make good use of the opportunity to save money on a monthly basis.

Moving to a new home for rent is an excellent opportunity to clean every corner that you would normally not be able to reach. Take one room at a time and start to unpack. This is a great time for a family to work together. The children can unpack their belongings and have it where they want it to be.

While the children are unpacking in their rooms, it can be a good idea to start unpacking the kitchen and get the major appliances and small appliances ready to make life easier. Get the beds prepared for the night and unpack the bathroom. Hang the shower curtain.

Now you are left with the living room and dining room. The last place to unpack is the garage. Most items here are not needed for now, so you have the next couple of days to organize the garage. Unpack the patio items at your own time and organize the space before you start to unpack.

Getting to know the neighborhood

Visit the nearby library and gather all the information regarding your house for rent neighborhood. Most libraries can provide information on parks, recreation facilities, theatres and special events. The library can also give interesting information on lakes, wetlands, birds and wildlife. Search for great hiking trails; explore scenic views and the beauty of nature. By now, you will be in desperate need of it.

Visit the museum nearby and learn about the history of your neighborhood. Here are some ideas on how to meet people in the new neighborhood:

• Invite the neighbours over to join you for tea and cake or a glass of wine;

• Get involved at school, volunteer to help during sport events and be present at parent meetings;

• You can volunteer to help at charity organizations. This is a great way of meeting people;

• Your children will make new friends at school. Invite them to your house for rent.

Landlord problems and actions

A pleasant relationship can wear down quickly when landlords or tenants fail to live up to their agreement. It is critical for both parties to use the proper process by the legislation in the territory where the house for rent is located. There are negative situations that can develop. Regardless of what happens, it is important to remember that you do have rights living in the house for rent.

Landlord conflicts often relate to emergencies, repairs and privacy. If the landlord is unresponsive to address and resolve a problem with the house, you can file a complaint with your territorial rental authority.

Some common reasons that result into landlords complaining are: failure to pay rent; continued disruptive conduct; willful damage to property; consistent lateness in paying rent; breach of rules and tenant’s conviction for a drug offense. Do not refuse to pay rent without court approval. This can get you evicted.