These fees accumulate and are intended to help the potential buyer build a security deposit, which can be used at the end of the rental period, if they decide to purchase. The purchase of rent, also known as a rental, is a rental agreement that provides for the rental of a property for an agreed period that offers the tenant the opportunity to purchase the property at the end of that period. “The way it normally works is the buyer and the seller will sign a lease agreement that will allow the buyer to live in the house, as a typical tenant, but with the intention of buying the property at the end of the lease,” Fourie said. “The details vary, but generally, in exchange for the first right of refusal, an additional amount is added to the monthly rent and acts as a down payment or down payment for the future purchase. This amount is often cancelled when the tenant decides not to buy the property when the lease ends, but can be charged on the purchase price according to the contract, if the sale continues. Although the Rent-to-Own option is often a win-win situation for buyers and sellers, it is recommended that in-depth investigations be conducted prior to the signing of the contract to compare the pros and cons. However, the biggest advantage of rent-to-buy is that it offers a tenant a bad credit interest rate or a young buyer a low credit interest rate, which is not eligible for a loan, the period to get a healthy credit history or save for a deposit to buy a home. Given house prices and current low interest rates, many buyers, who can comfortably afford a monthly credit rate, really don`t want to wait until they have saved a deposit before they get on the market. “The concept of own rental is not new,” says Barry Fourie of Rawson, “but many people don`t know it`s a real estate option. This can be risky for both parties, so it is important to fully understand what you are getting into before you accept anything, but there are situations where this can be a viable solution. Well, one answer is to rent a house now from an owner who is willing to give you an option to buy it later at a pre-agreed price.
And the possibility is not as unlikely as it sounds. Remember, many homeowners are renting their properties right now only because they have not been able to sell, and there are those who would be very happy to have the prospect of a sale at the end of a lease, and rental income in the meantime by financially healthy tenants, who also have an incentive to keep the property in good repair. , because it will be their own. Another possible reason for litigation is that the seller could withdraw the property from the market in the belief that a buyer has been found and that the loan has been approved, only to find that the buyer is no longer qualified for the loan until the end of the lease and that the seller loses the income he would have received from the property.