How Does Rent2Buy Work?
Your Current Situation
A lot of our clients have come from the rent drain where they have been outlaying their hard earned money for years and getting nothing in return other than accommodation.
We know that you probably understand this and really want to opt out of the rent drain and stop paying someone else's mortgage. But there is something stopping you.
Lots of people want to buy their own home but are not able to jump into the property market for numerous reasons…
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Bankruptcy
- New immigrants and no credit or job history
- Businesses or self-employed with less than 2 years trading history
- Do not like dealing with lenders lack of service or contact
- Recently changed job and no track record of stable earnings yet.
- Had the deposit but the market boomed and deposit was no longer enough.
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Do not have the 20% deposit required to odtain lenders approval.
- Bad credit history in the past
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Spent their deposit on something else.
A New Possibility For You
We are specialists who can help you secure your own home through Rent2Buy. Imagine arriving home to a house that is your own. The feelings of security and accomplishment knowing that you now have something that is growing in value. To top it all off, if you want to paint that fence or put in some landscaping and beautification then you can. It is yours!
How Does Rent2Buy Work?
With Rent2Buy, you need a small up-front cash contribution and then you make regular weekly payments (rent). Depending on how much weekly rent you pay, some of it can pay off the home as you go. This builds up your equity in the property and establishes a savings history which will show the bank you can afford a mortgage. Paying weekly rent in a Rent2Buy is similar to a bank mortgage where part of your payments would be interest, and part paying off the principle of the house. The difference is with our Rent2Buy, you are dealing direct with the vendor and the payments can be more flexible than dealing with a bank.
You have the right to buy at the agreed price at any time. There is a legal contract which gives you full control over the property and protects your interests. We advise clients to take a copy of the contract to their lawyer to have it explained and ensure they are happy with it.
What Are The Advantages Of Rent2Buy?
Your rent money is now working for you!
Every week a portion of your rental payment is credited towards the purchase price of the house. This amount can range from between $25-$150 depending on your requirements and initial cash contribution.
Get into a home with little cost
Normally when you buy a home the bank could ask for 20% down or more by the time you factor in closing costs. When using the Rent2Buy system of buying a house you only pay a 2-3% option fee that is deducted off the purchase price at the time you take up the option to purchase.
Option money is credited towards purchase
When you sign a Rent2Buy contract, you will pay the vendor an option fee. When you decide to buy the home this money will be deducted off the purchase price. Because you have already paid an option fee and you have been accumulating monthly rent credits, often there is little balance to pay towards your deposit at the time of settlement when you refinance, should you choose to buy.
Profits from appreciation
Since the sales price is locked in, as specified in your agreement, any increase in property value will mean that your equity, what you owe minus what it's worth, is increasing in the home. You can accelerate this 'equity growth' by making improvements to the property.
No lengthy mortgage approval processes
The landlord/seller is the sole person approving your application and this can be approved in as little as a day or two, instead of a standard lender who can take weeks to approve.
Control of the home and Home Improvements
You have full legal control of the home for a specified period of time without actually having to own it. So you can make improvements, capitalise on subdivision completion or zone changes an natural capital growth.
