Top Questions About A Rent To Own In Australia

by : Andrew C Clacy

Rent to own is a popular subject in Australia, and we have had many inquiries from people who wan to use rent to own to help buy their own house.

We have listed our top questions about using Rent To Own in Australia:

What does "rent to buy" mean?

Solution: It means you move in and rent the property and when you're ready you can buy it if you want to. You will make payments as per normal and when you decide to purchase we will give you back some of what you have paid as a credit towards your purchase.

How long does it take before I move in?

Solution: How long does it take to move into a house you are renting? As soon as the paperwork is sorted out you are good to go.

I'm not sure how this works. Do I own the home?

Solution: You are a tenant buyer, which means you are occupying the home now and have the right to buy it down the track.

Do I need a solicitor?

Solution: We recommend that if you are uncomfortable with paperwork, let's face it we all have that issue, then yes definitely get your solicitor to look over the paperwork.

When can the house become ours?

Solution: As soon as you are ready to refinance out. Simply use your good payment history with us to take to a lender and you can get them to finance you out. Then the home is totally in your name and you move on as normal.

What does a lease option mean?

1. Lease (rent) a property by signing a residential tenancy agreement

2. Pay for the right(option) to buy the property by an agreed date at a fixed price.The amount you pay (separately from the lease payments) is called the Option Fee.

3. You do not have to buy the property if you change your mind,however the option fee is non refundable.

4. On the option fee is paid,the seller must sell the property to only you at the agreed price in the agreed time frame if you wish to purchase and provided that the tenancy agreement has been met.

The specific details of the tenancy agreement are covered in the residential tenancy agreement which is the rental contract between you and the owner of the property.

What are the advantages of buying a property with a lease option? Only the seller's approval is required at this time and no bank or finance approval is required until you decide you want to arrange your own finance towards purchasing the property.

The purchase price is fixed at the time the legal documents have been signed and cannot be changed regardless of any change in the value of the property.

Unlike traditional financing from a bank there is a short exchange. If you are really unsure about purchasing the property or perhaps you are unsure if this is the property form then this gives you a chance to try before you buy and you can always change your mind about buying as you are not under any obligation to purchase.

Under the rent to own program if you choose not the go ahead with your purchase then all you forfeit is your up front deposit rather than losing thousands of dollars in Stamp Duty and loan repayments had you purchased it in the first instance.

Rent to owns are a great way to establishing an excellent credit history if you are currently unable to get a bank loan or any other finance or perhaps you have trouble with providing proof of regular income. The rent to own program can assist you in obtaining or fixing your credit history assisting you with other financial goals you may have in the future.

What are the steps I need to take towards moving in and owning my own property? Your will need to complete an application to take out a lease option on the property. An application fee of($650.00) is payable w hen the application is lodged. Consult a solicitor for an explanation of the Deed of option to ensure that is and represents the agreement reached with the seller for the option to purchase the property.