What To Expect When Selling Your House Via Rent to Own in Philadelphia

Selling Your House Via Rent to Own

Selling your house via the rent to own in Philadelphia strategy is an excellent option for both the buyer and seller. The seller can collect rent and additional money, while the buyer can try the house for a while. There are two types of rent to own contracts, the option to buy and the agreement to buy. The opportunity to buy lets the renter decide if they would like to purchase the house at the end of the rental period, while the agreement to buy is a more solid contract where the renter must purchase the home at the end of the rental period. This gives the buyer time to build up a deposit and find a financing strategy that works for them. If they end up not being able to qualify for the loan and have the option contract, this lets them off the hook and saves you from legal fees.

Negotiations

When selling your house via rent to own in Philadelphia, you can expect to negotiate the contract terms in your favor. You can have the buyer maintain the property and make the repairs to the house, except for some house repairs; make sure to research your local laws. You can negotiate the rental length, the amount of extra money added to the rent towards the deposit, and how much the option fee will be.

When handling the negotiations and the contract, the homeowner and buyer can approach this agreement without utilizing professional real estate services or licensed real estate notaries! If you feel more comfortable paying for professional services to overlook the contract and transaction, you can contact a real estate agent, title company, real estate lawyer, or notary. It’s essential to be clear about the stipulations and contract clauses to avoid any possible issues.  

Different Market

You will have a much broader market when selling your house via rent to own in Philadelphia. You will have plenty of buyers to choose from since many people are interested in “trying before buying.” This gives the potential buyer the option to buy the house after living in it for a few years, which is excellent news! They will have the chance to fall in love with it or decide maybe it isn’t the best house for their family before committing to homeownership. If they choose not to purchase it, you can turn around and list it as a rent to own home again!

Higher Sales Price

When selling your house via rent-to-own in Philadelphia, you can expect a higher purchase price if the renter decides to buy the house. The buyer will be willing to pay more to have this great opportunity. Also, the locked-in purchase price can be a great relief, especially if the market does not appreciate as much as you hoped since you negotiated the purchase price. The only change involving the locked-in purchase price for the buyer will be concerning their buying loan; the interest rates will adjust from when the agreement was signed to the actual purchase date. The house’s value will fluctuate up and down; having a locked-in price will be fair for both the seller and buyer.  

Additional Fees

When you sell your home via rent to own in Philadelphia, you are expected to place an option fee on the rent to own contract. This allows the renter to choose to purchase the house or not at the end of their rental term, which is typically three years. This option fee is non-refundable, even if they do not choose to purchase the house. Also, there is usually an additional amount added to each month’s rent to go towards a deposit on the house, and in a lot of cases, this amount is also non-refundable. It’s essential to keep in mind the closing costs once the contract reaches the purchase date, these closing costs are roughly three percent of the total sales, and these fees do not include the taxes from the property sale. If it’s decided to utilize a licensed realtor to complete the rent-to-own sale, the seller and buyer may be responsible for paying an agent commission of three percent. Using a notary or real estate lawyer is suggested to overlook the sale. These individuals charge a flat fee, typically two hundred to six hundred dollars, much less than your standard agent commissions. 

Monthly Payments

If you don’t need to “sell my house” right away, you can expect a monthly income for at least two years, usually three years, when selling your house via rent to own in Pennsylvania. This can help pay your mortgage or add extra funds to your investment pool for additional investments. You could also save that money for a different large purchase or create a savings account for something unique. Regardless of the intended purposes for the earned funds, it’s always nice to have a solid monthly income for a couple of years before cashing out with a large sum of money. Some individuals function better with a set monthly payment rather than having a lot of money; it’s relevant to the concept “out of sight, out of mind” because it helps individuals manage cash.  

The rent-to-own option benefits both the seller and buyer; the seller can generate a steady monthly income while the buyer can reside at the house to see if it fits their wants and needs within the home. The concept of rent-to-own has two different forms; the option to decide whether to purchase the property after a certain period or the actual agreement to buy the home. It’s essential to state all of the stipulations in the contract to be clear on the deal, and it’s suggested to use a real estate professional to oversee the contract and transaction. Usually, the purchase price is locked in at the agreed-upon sales value, while the option fee is non-refundable. There are many more benefits to renting to own than risks; understand the process and approach it properly with guidance. Contact “Buying Property 215” for further details and questions! (We’re a family-owned real estate company accredited by the Better Business Bureau with an A+ rating and 5-star google reviews!)

Call “Buying Property 215” at [215-359-6090] or send us a message to discuss what to expect when selling your house via rent to own in Philadelphia.

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