Richmond, Virginia is a great place to live. You can get to Washington DC easily and the historic area is full of charm and Civil War history. You will find cobblestone streets and plenty of cafes and artist studios. It can be hard to find a place to live and if you are having trouble getting financing, it can be even harder. One option is to buy a home using the rent to own method.
Charleston, West Virginia is another popular place to live, and for similar reasons. it’s close to Pittsburgh, but less expensive, and also has a nice college town feel to it, even though it’s a sizable city.
Read on to learn how rent to own works.
How Rent To Own Homes Work
When you buy a home with the rent to own method, you are basically signing a lease on the home that also has a special addition that allows you to purchase the home at a certain price once the lease is over. You usually have one to two years to do this. You will also have to pay a fee which is called an option consideration to do this. The option fee can be up to 7 percent of the purchase price and you won’t get it back if you decide not to buy the home, so make sure buying the home is something you want to do.
As you pay rent, part of your rent money goes toward the cost of the home. You have to pay your rent on time to take advantage of this option however. Pay the rent late and you won’t get the credit. When you pay your rent on time, you build equity while you are renting. Since your end goal is to buy the home, you will be responsible for maintaining the home.
This type of deal works great if your credit isn’t great. To get a mortgage from a conventional lender, you need a high credit score and when you do rent to own financing your credit score doesn’t matter. This gives you a real chance to buy a home when you might not be able to if you go through a conventional lender. The banks aren’t going to get involved and the transaction is between you and the owner of the home. You also get to build equity this way.
Richmond and Charleston are great places to live and if you can’t get financing from a lender, you will want to consider a rent to own situation. It doesn’t matter if your credit is poor, you can still buy a house when you rent to own.