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Rent-to-buy, also known as rent-to-own, is when there is a lease agreement between the tenant and owner which provides for the rental of the property by the tenant for an agreed period of time and at the end of that time, the tenant has a chance to buy the house from the owner.
There are several benefits of rent-to-own. We’ve mentioned them below.
The tenant and owner can agree on a locked purchased price. This means that when the tenant purchases the house, they will pay the amount that was agreed upon when the agreement was concluded.
Another benefit is the tenant can “test” the house before buying it. Living in the house before buying it provides the tenant with an opportunity to see if there are any issues related to the house, neighbours or neighbourhood that he/she does not enjoy or feel comfortable with.
Additionally, rent-to-buy provides more stability in that it reduces the possibility of incurring moving costs.
However, the biggest benefit of rent-to-buy is that it provides a tenant with a bad credit rate, or a young buyer with a low credit rate that does not qualify for a bond, the time period to obtain a healthy credit history or saving up for a deposit in order to purchase a house.
Property Law is a specialist field which requires a professional, holistic approach. Our conveyancing attorneys and associates, whom are on the panels of the major banks, provide a variety of professional property services.
Contact us for expert legal advice and assistance with your property sale, property rental or sales agreement.
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