Rent to Own

Is Rent to Own Right for You?

 

1. Do you have bruised credit and are unable to obtain a mortgage?

 

1. Do you have sufficient income to Rent to Own (you need a minimum of $75,000 in household income.)

 

1. Do you have a minimum of 5% of the value of the home you would like to own?

 

If you answered YES to all three questions then Rent to Own may be a program that will help you buy your own home.

 

Copyright 2011 Kaceey Team 416-553-6376 kenc@kaceeyteam.ca

 

The Advantages of Rent to Own

 

1. Monthly rental payments now contribute to owning a home of your own.

 

1. You choose the home you want. Someone else covers the mortgage and down payment and takes care of closing costs for the 3-year rental period.

 

1. During the 3-year rental period, together we ensure your credit is fixed, you have the closing cost and down payment sufficient for you to purchase the home at the 3-year mark.

 

1. You have a contract up front for the purchase price of your home – no surprises.

 

1. During the rental period it is your home and you can make improvements that will increase the value and know that the increased value is for your benefit.

 

1. You can now get settled into a community of like-minded people.

 

Copyright 2011 Kaceey Team 416-553-6376 kenc@kaceeyteam.ca

 

How is the Rent Amount Calculated?

 

1. The rent is based on the mortgage cost of the home you choose at 80% of the value.

 

1. For example, on a $300,000 home, the rent would be based on the cost of a $240,000 mortgage. At today’s rates it would be about $1,100.

 

1. Then we have to include property taxes and insurance which is about $310 a month.

 

1. Then 20% of that total ($1,410) is added with 10% to the Investor to cover the cost of his money plus 10% that goes towards your down payment (a forced savings).

 

1. When it is all added up, on a $300,000 house the rent is about $1,682 a month all in.

 

Copyright 2011 Kaceey Team 416-553-6376 kenc@kaceeyteam.ca

 

The Technical Details

 

1. At our first meeting you submit a $1,000 non-refundable deposit (that goes towards your down payment)

 

1. You complete a mortgage application

 

1. You sign a Buyer’s Representation Agreement

 

1. Then we obtain a mortgage approval (subject to meeting the criteria by the end of 3 years)

 

1. An Investor is chosen to act as you home buyer

 

1. We suggest 5 houses for you to choose from in the area where you want to buy and in the price range you can afford

 

1. We negotiate a purchase price and once both sides agree, we arrange for a home inspection to ensure both you and the Investor are satisfied with the condition of the house (this protects both you and the Investor from most unforeseen problems)

 

1. You then complete a 3-year lease Agreement and an Agreement of Purchase and Sale for the home (for a fixed price at the end of the lease term). The fixed price is based on the purchase price plus 5% increase per year.

 

1. Then the Investor closes the sale with the Seller and you are given the keys to your new home

 

 

Copyright 2011 Kaceey Team 416-553-6376 kenc@kaceeyteam.ca

 

 

How Do We Make Sure you have the Deposit When it Com es Time to Buy?

 

1. The 5% you put down up front goes towards your down payment

 

1. The $1,000 non-refundable deposit goes towards your down payment

 

1. The 10% a month of the rental cost goes towards your down payment

 

1. The balance we will work out and you will save that amount each month so you have the right amount when the time comes to pay your down payment and closing costs.

 

Copyright 2011 Kaceey Team 416-553-6376 kenc@kaceeyteam.ca

 

 

How do we Make it Happen for You?

 

1. We meet and confirm your wants, needs and financial situation.

 

1. Together, we develop a plan to have your credit score improved (over the 3-year period) so that you will qualify for a mortgage (when it is time to buy the home). In fact, we arrange for a written mortgage approval up front, based on you meeting certain criteria by the end of the 3-year rental period. And, we arrange for you to meet a credit counselor to work with you over the term.

 

1. Together, we ensure that you have the necessary down payment and closing costs to purchase your home at the end of three years (it could be sooner if qualifications are met earlier).

 

1. If this sounds like it makes sense for you call Ken Campbell at 416-553-6376 to set up an appointment to answer any more questions you may have and to start the process.

 

1. You can print and complete the mortgage application here in advance of our meeting

 

Copyright 2011 Kaceey Team 416-553-6376 kenc@kaceeyteam.ca