RENT TO OWN LABS, LLC
ORLANDO, FLORIDA

So, make sure that what you pay the seller is enough to cover the mortgage, taxes and insurance for the property. You’ll have to negotiate with the seller how long your lease will last; the rental term should be exactly how long you think it’ll take you to save up for the down payment, so be very cautious here. Furthermore, you should also confirm with the seller/landlord the dates of payment for the lease, the home’s actual mortgage, and other expenses that may arise. This will ensure everything is getting paid on time and prevent issues between you and the landlord in the future. On the other hand, the landlord usually pays property taxes and insurance, because they are ultimately responsible for their home. You should also discuss matters such as renter insurance policies and home modifications during the contract drafting. Establishing awareness of these terms and conditions will help you to prevent issues later during the leasing period. The rent credits have been stored in an escrow account by the seller, which is separate from the seller's bank account. The money is given to the bank as part of your down payment along with your option fee when you buy. However, if you cannot or do not wish to purchase the home, the seller gets to keep all the rent premium you have paid throughout the leasing term. Some sellers actually charge you fair market value for the rent and credit a part of that to you if you purchase the home. It's important to note that is a very good deal for the buyer, but it's uncommon. In this scenario, Tom would save the same amount of money as the above, but instead of paying $1,800 per month, he would pay $1,500 per month. A more common variation is for the seller to match the buyer's premium payments. Let's continue from the example above and look at how rent credit matching works: The seller of the property Tom is renting to own has agreed to match Tom's $300 premium payment. So, instead of saving $300 per month, Tom is saving $600 per month. Over the course of 3 years, Tom saved $21,600 or 72 percent of the cost of the down payment. If at the end of the term you can’t afford to purchase the house or decide you’d rather not buy it, the non-refundable option fee and rent credit would expire. You’d lose all equity earned towards the home, and the seller would keep your option money and rent credit.