Frequently Asked Questions
General questions about our company, service, and properties we offer on this website:
- What does Rent to Own actually mean?
- What is the Rent to Own process?
- Do appliances or furniture come with a rent-to-own home?
- What if I have bad credit? Can I still get a rent-to-own home?
- Is there a down payment on a rent-to-own home?
- What are the benefits of a rent-to-own home?
- What are the requirements of a rent-to-own arrangement?
- I Found a Home I Love, But My Credit Is Bad, Can I Still Be Considered?
- I Have Heard Some Negative Things About Rent to Own, Why Do People Do Them?
- What If I Don’t Have a Huge Down Payment?
- What Is Your Down Payment Assistance Program?
- I Expect Some Additional Funds for My Down Payment, Should I Wait?
- How Much of a Down Payment Will I Need?
- What Methods of Down Payment Are Accepted?
- What Happens to My Down Payment (Option Payment)?
- What if I Fail to Qualify or Am Unable to Purchase in Time?
- How Long Does It Take to Move Into a Property?
- Is There a Lot of Paperwork Required?
- Are you able to provide financing if I’m unable to get traditional financing?
- What Is My NEXT STEP?
What does Rent to Own actually mean?
In most cases, a rent-to-own agreement is a contract on a property that works like a lease and leads to a purchase. It’s often called a lease with an option – or a lease/option agreement for short.
The lease portion is a standard rental agreement that includes monthly rent, a security deposit, and other typical terms.
The option in the contract gives you the right to purchase the property after a set time period – usually around 3 years. This gives you the ability to save money towards a down payment, repair credit, increase your income, or otherwise improve your ability to qualify for a mortgage.
Most of the time people use a traditional mortgage loan to purchase the property prior to the expiration of the option period, but there are other options if your financial situation has unique needs.
We help lots of folks like you purchase the home of their dreams.
Fill out the form below to get started on your way to homeownership!
What is the Rent to Own process?
The rent-to-own process is actually pretty simple.
Once you’ve seen one of our fantastic properties, we’ll give you an application to fill out. Don’t worry – we help people with all kinds of credit and financial situations, and if you can afford the property, we can probably help you to own it.
After you’re approved to rent the property, just sign the lease, pay your security deposit, and rent – then move on in!
Your lease/option agreement (also known as the rent-to-own contract) will spell out the length of time that you have to complete the purchase of the property – typically 3 years, but in certain circumstances, we may extend your option if you need more time.
The purchase of your home usually takes place through a traditional mortgage loan, but there are other ways to complete the purchase, depending on your finances.
That’s the process!
Once you’ve completed your mortgage, you’re done – now you own your home!
First step – sign up to find great properties around Alamance County | Burlington NC just by filling out the form.
You’ll get immediate access to great rent-to-own homes, plus a whole lot more.
Sign up and get started now!
Do appliances or furniture come with a rent-to-own home?
Most of the time, furniture isn’t included with a lease/option purchase.
Generally, the basic appliances are there – like a refrigerator, stove, oven, and sometimes extras, like a dishwasher, a washer, and a dryer. Parts of a property that are installed or attached – like the heating system and air conditioning – are definitely included.
Sometimes, we’ll offer a property that includes some furnishings. Most buyers want to bring their own stuff with them from their previous homes, and that’s why furniture is sold separately.
There are many companies out there that provide a rent-to-own service for furniture or extra appliances, and you’ll get lots of choices on styles and types.
But be careful!
Even though the rent-to-own real estate can be a great deal, some (not-so-honest) furniture companies will charge you huge amounts for a rent-to-own agreement. You might end up paying 2-3x more for these products than if you bought them outright.
Plus, those appliances will probably go down in value – unlike real estate, which usually goes up in value.
Of course, you want your money to be going to an asset (like your home) that will rise in value, not expensive interest payments on new furniture.
So don’t wait! Fill out the form at the bottom of this page to get started now.
What if I have bad credit? Can I still get a rent-to-own home?
Yes, you can! Many people with bad credit can still get a rent-to-own home.
Every situation is different, but we specialize in helping people who have been through tough circumstances (or just made mistakes in the past) to repair their credit and get started on the path to a great financial future.
Even if your credit is bad, you can still own a property!
One of the major benefits of a rent-to-own scenario is that it gives you time to repair your credit before you purchase your home. You’ll enjoy many of the benefits of home ownership while you’re rebuilding your credit and saving money towards a down payment.
So fill out the form at the bottom of this page now and get your piece of the American dream!
What are the benefits of a rent-to-own home?
There are a lot of benefits to a rent-to-own agreement!
In the Alamance County | Burlington NC area, lots of smart people are using rent-to-own agreements as a way to get the home of their dreams without having to qualify for a bank loan right away.
In the past few years, banks have been very tight on their lending criteria. Most people who use a rent-to-own agreement want a few years to get ready to qualify.
Here are a few more reasons to use a rent-to-own agreement:
- Try before you buy! You get to live in your rented home before you actually purchase it, allowing you to make sure it’s actually your dream home. If you don’t like the house, you don’t have to complete the purchase.
- Own without great credit or a big down payment. You can start feeling like a homeowner right away while saving up and improving your credit.
- Privacy. You’re not listed as the purchaser on any public records until the closing takes place, giving you years of privacy.
- Move in fast. Since you don’t have to wait for a mortgage, you can often move in right away – and get started living a new life in the home of your dreams!
So don’t wait! Get started now by filling out the form at the bottom of this page.
Is there a down payment on a rent-to-own home?
Not right away!
You don’t have to have a down payment until your purchase is complete (typically 3 years). However, there is usually an amount due upon move-in and execution of the option to purchase agreement.
Just like any other lease agreement in Alamance County | Burlington NC, there may be a security deposit and a small application fee in addition to the fee upon move-in. Of course, you’ll have to pay rent each month.
We can help you to structure the perfect scenario to meet your needs. We’ll show you the rent-to-own calculators and formulas that we use when we prepare your agreement, and help you figure out what’s best for you.
So don’t wait! Get started now by filling out the form at the bottom of this page.
What are the requirements of a rent-to-own arrangement?
We know that every person, family, and the situation is different.
We do our best to help you uncover creative solutions to help you own the home of your dreams.
Once you’ve had a chance to check out the house, you’ll fill out a rental application that will include detailed information on everyone living in the home.
We’ll conduct a credit check and verify the income(s) for everyone over 18 who is living in your household to confirm that you’ll be able to make your monthly payment.
People with bad credit, no credit, limited cash available, and other financial situations have all been able to lease then purchase their perfect piece of real estate.
We’ll speak with your references and previous landlords because relationships matter to us more than just scores assigned by a computer.
We love helping great folks to reach their dreams, so don’t be afraid – fill out the form below to get started!
I Found a Home I Love, But My Credit Is Bad, Can I Still Be Considered?
ABSOLUTELY!!! Our program is designed to work with individuals with good, fair, or blemished credit. However, there is an application process as we want to ensure that you have the proper income and a history that reflects your ability to pay, or a pattern of credit restoration or rehabilitation. In other words, if you are recovering from a trial in your life, we want to see a pattern that you are establishing a history of payment since that time. Rent to own is a serious proposition and an investment in a home purchase opportunity. We want to make sure that we treat you fairly and are not putting you in a position in which you cannot be successful. We also offer owner financing where you can buy the home without having to qualify at a bank. In some cases, we can start you out in a lease option situation and “graduate” you to our owner financing program after a period of time. We can qualify you based on your established history with us. This is why so many buyers consider ABC Residential Properties, LLC as their first choice when looking for their dream home!
I Have Heard Some Negative Things About Rent to Own, Why Do People Do Them?
There are a number of reasons that people enter into lease to own or rent to own agreements. I often say that rent to own is like road testing a car, you get to ride it for a little while as you make a decision as to whether or not you want to buy it. This program is good for people they may not have the necessary credit right now but are in the process of rehabilitating their credit situation. This also is a great program for individuals who may be self-employed and may not have an established business history to qualify traditionally from a bank, individuals with short-term employment history; in addition, individuals who are relocating to an area and want to have an ownership interest in a home rather than pay money in traditional rent, the rent to own program also gives them a viable option to home ownership.
What If I Don’t Have a Huge Down Payment?
We will try to work with you even if you don’t have a lot of money for a down payment! There are a few different programs where you can get into the house you like and complete your down payment while in the house (please ask us about our Down Payment Assistance Program).
What Is Your Down Payment Assistance Program?
Our down payment assistance program may help you by allowing you to get into the home you like with a minimal amount of down payment and be given a short period of time to pay the balance of your option payment or down payment over several months.
I Expect Some Additional Funds for My Down Payment, Should I Wait?
If you found a home you like, you should NOT wait! You can move in with as little as two months’ rent down and transition into our lease option program when you have the additional down payment.
How Much of a Down Payment Will I Need?
That depends on your monthly payment, gross income, and the price of the home. However, a range can be as low as $2,000 or up to $10,000 for most of our homes. The rule of thumb is 5% for a Lease Option / Purchase program and a minimum of 10% for our Owner Financing program. Remember, we accept borrowed funds from family or friends, your pension plan, etc. and in some cases can give you up to 30 – 60 days to make the down payment.
What Methods of Down Payment Are Accepted?
We are flexible in how we can work with you with your down payment, unlike many of our financial institutions and other lenders, we are able to accept and borrow funds from friends family who may be willing to lend you the money. You also may be eligible to borrow money from your 401K or retirement funds to purchase a home without penalty.
What Happens to My Down Payment (Option Payment)?
The option payment is paid upfront and secures your option contract to purchase the property. The option fee is non-refundable. If you decide not to purchase the home at the end of the agreement or default upon your agreement, then you will lose your option fee as well as any other money that you may have put down. The option fee grants you the exclusive option to purchase with a contract that has agreed upon terms. These terms cannot change, and the seller must sell the property under the option terms. However, the buyer has the option to buy or not buy. This is the cost of the seller having made that commitment to sell to you exclusively over a period of time. Should you exercise your option to purchase, then the option fee will be applied towards a down payment or reduction of the purchase price.
What if I Fail to Qualify or Am Unable to Purchase in Time?
If you are unable to purchase the home during the option period, one of two things usually happens:
The contract expires and you no longer have the legal right to purchase the property. Further, you forfeit all interest in the property and the option fee paid to the seller.
The option agreement may offer you the ability to extend the agreement. If this extension is offered, it typically requires a small fee and/or criteria you must meet. For example, a seller may require that you are currently qualified for a mortgage and in the closing “process,” to qualify for the extension.
How Long Does It Take to Move Into a Property?
Once the complete application is submitted and approved, it is usually in 1-2 weeks.
Is There a Lot of Paperwork Required?
Absolutely not! As part of the application process, we will need your current W-2s, two years of tax returns, a completed application, and payment of the application fee. Upon approval, a local attorney will prepare all the documents and we will arrange a date for contract signing. The documentation will include a summary of all financial terms and conditions of your purchase, such as (if applicable): purchase price, cash down payment, interest rate, monthly payments, escrow payments, and any other terms specific to your transaction.
Our process is really fast and easy.
Are you able to provide financing if I’m unable to get traditional financing?
In some cases, we are able to provide financing, typically for a short period of time five to seven years. We would still have to qualify you for that program and typically if you are in our rent-to-own program and have established a payment history with us, we may be able to convert your contract from rent-to-own to seller finance. However, this will require additional down payment money typically a minimum of 10% is required.
What Is My NEXT STEP?
If you found the house you like, now is the time to get all the financial details of your purchase ironed out. Call or text us and we will send you a preliminary application to fill out. Then we will discuss the financing plan with you and tweak it to your particular situation. It is IMPORTANT to bring an initial Deposit to Hold of a minimum $1,000 to your appointment, so we can take the house off the market. You need to “stake your claim” before someone else does! The Earnest Money Deposit is applied towards your (option payment) down payment. This money is refundable back to you if your application is not accepted. Please realize, until we receive a commitment from you, the house is available to other buyers, regardless of prior verbal or email communication we may have had before.