Rent to buy condo

[Donal78 0]

Have ppl heard of this before. We are due to move into a 2 bedroom condo in 2 weeks with a view of buying the condo in 4 months. The owners of the condo have agreed to sell at an agreed price. It seems too good to be true!!! Coming from ireland i have never heard of this done before but it has got me thinking now.

[payxibka 10,044]

Have ppl heard of this before. We are due to move into a 2 bedroom condo in 2 weeks with a view of buying the condo in 4 months. The owners of the condo have agreed to sell at an agreed price. It seems too good to be true!!! Coming from ireland i have never heard of this done before but it has got me thinking now.

Rent with an option to buy is certainly not the norm but is not unusual either.

[rebeccajo 14]

People are more desperate to sell these days. All bets are off and more creative measures are being taken to move properties.

Are you getting credit for what you are paying as rent towards the purchase price? Or are you simply paying rent now, and they have agreed to sell you the property 4 months from now for XYZ price? If you are getting rent credit, you might want to start shopping mortgages now. Some lenders won't allow a rent credit.

The number #1 question I would be asking myself is if I REALLY want to buy this property. If you change your mind in four months, the seller may be able to sue you for breach of contract.

[Donal78 0]

People are more desperate to sell these days. All bets are off and more creative measures are being taken to move properties.

Are you getting credit for what you are paying as rent towards the purchase price? Or are you simply paying rent now, and they have agreed to sell you the property 4 months from now for XYZ price? If you are getting rent credit, you might want to start shopping mortgages now. Some lenders won't allow a rent credit.

The number #1 question I would be asking myself is if I REALLY want to buy this property. If you change your mind in four months, the seller may be able to sue you for breach of contract.

We sign the papers on the 15th of november.YES we really want this place and no the rent is not going towards downpayment. So the next 4 months will give us a chance to save for a deposit. We have already been pre approved for a mortgage so thats no problem.

[rebeccajo 14]

People are more desperate to sell these days. All bets are off and more creative measures are being taken to move properties.

Are you getting credit for what you are paying as rent towards the purchase price? Or are you simply paying rent now, and they have agreed to sell you the property 4 months from now for XYZ price? If you are getting rent credit, you might want to start shopping mortgages now. Some lenders won't allow a rent credit.

The number #1 question I would be asking myself is if I REALLY want to buy this property. If you change your mind in four months, the seller may be able to sue you for breach of contract.

We sign the papers on the 15th of november.YES we really want this place and no the rent is not going towards downpayment. So the next 4 months will give us a chance to save for a deposit. We have already been pre approved for a mortgage so thats no problem.

Sounds like a very sweet deal then!

[Fandango 1,439]

nothing's for nothing, that's what I always say.

Be careful!

[rebeccajo 14]

nothing's for nothing, that's what I always say.

Be careful!

Why is this deal something for nothing? I don't understand.

[w¡n9Nµ7 §£@¥€r 123]

nothing's for nothing, that's what I always say.

Be careful!

Why is this deal something for nothing? I don't understand.

Oh that's just one of those things people in sales like to say

[Fandango 1,439]

nothing's for nothing, that's what I always say.

Be careful!

Why is this deal something for nothing? I don't understand.

Meaning: rent to owns are usually tricky and V beneficial to the seller. I'm not going to go into a fuill diatribe about them, so just a cautionary friendly note of 'sounds too good to be true it usually is'

[Donal78 0]

nothing's for nothing, that's what I always say.

Be careful!

Why is this deal something for nothing? I don't understand.

Meaning: rent to owns are usually tricky and V beneficial to the seller. I'm not going to go into a fuill diatribe about them, so just a cautionary friendly note of 'sounds too good to be true it usually is'

I was looking at the website zillow.com today. The condo we may be buying is a 2 bedroom overlooking the water only a few minutes walk to the city center. After initial investigations the condo was originally bought for $265 in 2002 and now they have it at sale for $299. \

* They have put in a new kitchen

* marble countertops

* new appliances

* Upgraded the bathroom.

* We will also have a large deck which overlooks the water.

Its not an ideal location for me to get to work ( 1 Hour from boston)but my wife wants to be close to her parents for when we have kids. We had a place in peabody but that fell through as the condo fees were too expensive. It didnt help that my in laws blew a casket when they heard that as they want us closeby.

After 8 months living with the inlaws i dont really care as i am not looking at this house/condo as an investment. We just want something to call home for a few years.

[Fandango 1,439]

nothing's for nothing, that's what I always say.

Be careful!

Why is this deal something for nothing? I don't understand.

Meaning: rent to owns are usually tricky and V beneficial to the seller. I'm not going to go into a fuill diatribe about them, so just a cautionary friendly note of 'sounds too good to be true it usually is'

I was looking at the website zillow.com today. The condo we may be buying is a 2 bedroom overlooking the water only a few minutes walk to the city center. After initial investigations the condo was originally bought for $265 in 2002 and now they have it at sale for $299. \

* They have put in a new kitchen

* marble countertops

* new appliances

* Upgraded the bathroom.

* We will also have a large deck which overlooks the water.

Its not an ideal location for me to get to work ( 1 Hour from boston)but my wife wants to be close to her parents for when we have kids. We had a place in peabody but that fell through as the condo fees were too expensive. It didnt help that my in laws blew a casket when they heard that as they want us closeby.

After 8 months living with the inlaws i dont really care as i am not looking at this house/condo as an investment. We just want something to call home for a few years.

$300k and you're not looking at this as an investment?

[Donal78 0]

To be honest no. I have moved so much in the last few years we just want somewhere to call home.

[w¡n9Nµ7 §£@¥€r 123]

To be honest no. I have moved so much in the last few years we just want somewhere to call home.

I can understand the sentiment but rationally speaking, is it really wise to ever spend a large amount of money on real estate without the expectation of ROI?

[Fandango 1,439]

To be honest no. I have moved so much in the last few years we just want somewhere to call home.

I can appreciate that as well, but committing to paying $300k should be looked at from an investment standpoint as well.

I am speaking from my own perspective away from my profession: I and several friends have dabbled in the investing side of RE and I can tell you that if you don't have every single one of your bases covered, then you're going to be wasting money.

You don't have a down payment, but you're going to spend money renting for 4 mos...all the while not a penny is being credited. Usually, again from my own experience as an investor, you should be getting some sort of credit towards something. That's what rent-to-own means.

Before you agreed upon a price, did you get the property inspected? Get an appraisal? Speak with an agent to see if there's any other properties around that are comparable? Have you spoken with a lender to see if you qualify for any mortgage, so the seller doesn't need to hold a note at all? What rate is the seller charging you? Any prepayment penalties? What if the property market slows down, and 4 mos from now, your agreed upon price is overmarket? Is there a balloon payment at the end? Have you locked seller into an agreement with price and terms? Have you checked the condo bylaws that subletting is permitted? What else does the HOA by laws say?

Honestly, there are so many factors involved, I'd just say to make sure you know what you're getting into. Nothing more, nothing less.

[Donal78 0]

To be honest no. I have moved so much in the last few years we just want somewhere to call home.

I can appreciate that as well, but committing to paying $300k should be looked at from an investment standpoint as well.

I am speaking from my own perspective away from my profession: I and several friends have dabbled in the investing side of RE and I can tell you that if you don't have every single one of your bases covered, then you're going to be wasting money.

You don't have a down payment, but you're going to spend money renting for 4 mos...all the while not a penny is being credited. Usually, again from my own experience as an investor, you should be getting some sort of credit towards something. That's what rent-to-own means.

Before you agreed upon a price, did you get the property inspected? Get an appraisal? Speak with an agent to see if there's any other properties around that are comparable? Have you spoken with a lender to see if you qualify for any mortgage, so the seller doesn't need to hold a note at all? What rate is the seller charging you? Any prepayment penalties? What if the property market slows down, and 4 mos from now, your agreed upon price is overmarket? Is there a balloon payment at the end? Have you locked seller into an agreement with price and terms? Have you checked the condo bylaws that subletting is permitted? What else does the HOA by laws say?

Honestly, there are so many factors involved, I'd just say to make sure you know what you're getting into. Nothing more, nothing less.

I appreciate your advice, some excellent points.

Before anything is signed we will get it inspected as we already have noticed several small things that will have to be fixed. The best thing we can do is talk to somebody before we aggree to anything. Thank you again lisa. This condo is more a long term investment for us as we are not looking to resell for 5 years at least. Thats why i discounted the wording " Investment property"

Edited November 3, 2006 by Donal78