When you look around, it might seem like everyone you know owns a house. Yet, you might not own one but wish you did.
The truth is that 66% of Americans own homes. But you can, too! One solution is to look for rent-to-own homes. This option works well for people who don't qualify for mortgages.
Continue reading to learn more about how this works.
Why People Turn to Rent-to-Own Homes
Becoming a homeowner is a dream for many Americans. However, many people do not buy homes because they cannot get mortgages. Getting a mortgage requires having a down payment and a good credit score.
You can work on these things, but it takes time to meet the requirements. If you're working hard to buy a house but need more time, you could turn to a rent-to-own home.
People buy these homes when they do not meet the loan requirements lenders have. It allows them to buy homes sooner, and it's a great idea for many people.
If this sparks some interest, you can start searching for rent-to-own homes. You can also look at current real estate trends to determine if now is a good time to buy a house.
How It Works
Rent-to-own real estate works through several steps. The first step is finding someone willing to sell their home this way. While most people do not use this method, some will.
Next, you create a contract with the seller. You agree to pay a monthly rental amount and provide a deposit. At any point, you can decide to buy the home instead of renting it.
The seller applies some of your rent payments to the principal home balance. You must then get a loan in your name. This generally happens five or more years later.
Buying a home through this method gets your foot in the door. If your credit improves over the next few years, you may be able to start using some real estate investing strategies to purchase more homes.
Benefits of Buying a Rent-to-Own Home
Paying for a home might be easier through rent-to-own. You can buy a house with less money down, and your credit score will not affect your purchase.
These are a few benefits of buying a rent-to-own home. Another benefit is that you do not have to buy a house. If you live there for a while, you might decide you do not want the home. In this case, you do not have to go through with the purchase.
Additionally, buying a home gives the ability to build equity. Renting does not. Therefore, owning a home, even if it's rent-to-own, helps you improve your financial situation.
Start Looking for a Home to Buy
Finding rent-to-own homes is more challenging than finding traditional homes for sale. But they're available if you search in the right places.
PMI Riverside is a company specializing in real estate services. We have more than 20 years of experience in real estate and can help you find rent-to-own homes.
Are you ready to learn more? Reach out to us today.