In the Indianapolis real estate market, as with other markets around the United States, the rent-to-own home provides an interesting option for today’s buyers. Like other states around our nation, Indiana‘s economy has struggled in recent years and especially for those who have had financial difficulty, owning a home seems out of the question. But the rent-to-own option may provide a way for those who have had recent troubles to still work toward homeownership. Rent-to-own homes options can even be ideal for people who have struggled financially because the rental period gives you time to rebuild your credit.
For some looking for Indianapolis homes for sale, mystery surrounds the rent-to-own homes option. How does it work? How do you locate these properties?
Experts say that not only should you research the property but you should also investigate the seller. It is recommended that those interested in the rent-to-own option peruse classifieds online and in newspapers, such as the Indianapolis Star, for rental properties and call to ask if they would sell instead. You can ask your Indianapolis REALTOR® to help make these calls.
Many times, the owners of these rental properties will consider the option of selling. The estimate is upwards of 50% of sellers claim they would consider this option if a viable offer was presented.
When calling on Indianapolis homes that are regularly listed for sale, look first at the homes that have been on the market 120 days or longer. Make sure that you or your REALTOR® check that the property is not in foreclosure or about to be, as banks may be starting to look at that option as well.
Another piece of information to check is if a property listed to sell is currently occupied. If it isn’t, the owner will be under greater burden to find an occupant. And because these homeowners had to move before they could sell, they make a great party in which to present an alternate solution, like renting to own.
To insure that a property is not at risk for foreclosure, ask for a statement of mortgage authorization. You will also want to think about making sure that your payments are protected and going toward the mortgage by sending them directly to the mortgage company or by way of a third party who will pay them. When paying the seller directly, you cannot insure that your payments are going toward the mortgage.
Another area to negotiate on the front end is how to deal with repairs that may come up while you are renting to own. This can be handled different ways but one common way is to agree to split the costs somehow, such as the buyer would bear the cost of the first $1000 and the seller would pay the rest, kind of like an insurance deductible.
As with any transaction, make sure you have the property inspected by a qualified inspector before moving forward with the deal. Work with your REALTOR® to negotiate a better deal based on what you find wrong with the home beforehand.
There are many options for owning a home around Indianapolis and the rent-to-own homes alternative is just one of them. The option to rent while you’re buying is not as well-known as the traditional route of homeownership but it certainly does expand our options which is helpful in today’s economy.