If you are an aspiring homeowner, then Rent To Own Homes in Canada may be a wise option for you, especially if you are not financially ready. These agreements give you an opportunity to fix your finances, improve your credit score, and save up some money for the down payment before making the actual purchase.
With housing prices going over the roof in cities across Canada, it can be difficult for an average citizen to be able to afford a home. Apart from that, getting approved for mortgages has also become challenging with lenders adopting more stringent lending practices. Despite low mortgage rates, the home loans are still hard to get due to strict criteria.
So what should a prospective home buyer do? Luckily, there is another option for them that can make their dream of owning a house a reality.
Rent To Own Homes in Canada has gained a lot of traction over the years for this very reason. In this arrangement, you pay rent every month to the landlord or homeowner just like a renter. However, with the rent-to-own program, a portion of this rent can be pegged towards the down payment, making it possible for you to buy the property eventually.
However, before you sign the contract, here are some steps to keep in mind when you consider rent-to-own property.
Read the terms carefully
Never sign the dotted line unless you fully understand the terms and conditions. Experts also recommend that you should preferably choose to enter a lease option rather than a lease purchase agreement.
Take help from qualified professionals
The legal parlance can be difficult for a layman to understand. This is why it is crucial to hire a qualified real estate attorney to help you understand the contract along with your rights and obligations. You may also want to negotiate some points before signing the deal or even avoiding it if isn’t favourable for you.
Research the arrangement
While you are at it, make sure you understand a certain things such as the deadlines, what is due and when, how the purchase price will be determined, the rent payments and applicable option fee with regards how much of each will be applied towards the purchase price etc.
You must also pay attention to other aspects such as if the pets are allowed, maintenance costs and responsibilities, what does the term “maintenance” entail etc.
Due diligence of the home and the seller
Make sure that the property is properly inspected and all the taxes are up to date before you consider rent-to-buy the house. You must also check the seller’s credit report to identify signs of trouble and get a full title report to see how long he has owned it.
Make sure you have thoroughly educated yourself about the arrangement before you enter one. It is a great option for you if you make an informed choice.
