August 25, 2022
Author: Heather Connor, Realtor
Are you wondering if rent-to-own is an option for you in Crested Butte?
Let's cover 5 basics to see if this could help you get into home ownership.
3. Lease Option Vs. Purchase Option
5. Upfront fee
It’s good to remember that an ideal rent-to-own candidate is someone that is an aspiring homeowner. This option allows you to get your finances in order, improve your credit score, and save money for a downpayment while locking in a house that you’d like to own.
This requires both a standard lease as well as a rent-to-own agreement.
You will commit to renting a property for a specific period of time and then an option to buy a property at a later date.
#3 Lease Option Vs. Purchase Option
A lease option gives you a right to purchase the home when the lease expires. The purchase option requires that you purchase the home.
The details of each contract needs to be negotiated and memorialized in writing in the agreement. Some options may allow a percentage of rent to go towards the downpayment, some may require a higher level of responsibility towards maintenance, repairs, etc,
#5 Non-refundable Upfront Fee
The option fee is what gives you the option to buy the house by a specific date in the future and it is negotiable, usually 1% to 5% of the purchase price.