MyEasySell Rent-to-Own

A mortgage loan is not the only way to buy an apartment with an installment payment. There is a way to purchase an apartment in installments even without contacting banks or other credit financial institutions. Are you surprised?

If you google “lease with option to purchase”, it turns out that despite a very small percentage of such offers, this practice is still gaining momentum. That particularly applies to illiquid assets, very expensive real estate or the primary housing market, new buildings. It is interesting that in the recent years it have been developers who are increasingly adopting the practice of leasing with the right to purchase, when selling new buildings. No wonder actually as this is a great selling tool at the falling market or during the crisis.

It appears that a number of European countries use this civilized streamlined and relatively massive approach to leasing with the right to buy or purchase by installments. For example, in Spain, this procedure is called “alquiler com opcion a compra”and is implemented as follows: the agreement includes a fixed the value of the property, the initial advance payment (let’s say, 10% of the property value), monthly rental payments for the agreed period (for example, for 5 years), which are fully or partially treated as buyout payment and the rest one-time payment upon expiration of the specified contract period.

Moreover, what is interesting, that having come to the bank for a mortgage for this real estate object in the end of the contract, when it is necessary to payout a significant one-time payment, Spanish banks will treat the already made payments as the own funds paid.

An example typical for Spain: object’s cost is 100,000 euros. Monthly rent – 500 euros (as a rule, the whole amount treats as buyout payment). Advance payment – 10,000 euros. For the period of five years the owner will receive 40,000 euros from the tenant/ potential buyer (where 10,000 is an advance payment and 500*60 months = 30,000). 60,000 euros is the final payment in five years, which the bank will gladly lend to the buyer.

Refusal of the buyer /tenant to exercise the rights to redeem the property leads to the loss of all paid funds in full. The failure of the buyer / tenant to make proper rental payments leads to the loss of the rights to purchase.

Of course, the market may change significantly during the term of the rent-to-own contract that may lead to deterioration for one of the parties. However, the risks associated with mortgage lending are the same and even higher.

We are sure that what you really need is the platform-aggregator with Rent-to-Buy offers as the alternative to mortgage lending and the sales mechanism in any market situation. Rent-to-Own is a unique anti-crisis solution to the real estate issue without mortgage slavery. This is also a return to the old traditions of long-term, multi-year lease rights with a fixed fee and the confidence that you will not be evicted in a year.

Do you want to place your object in sale with Rent-to-Own?

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