Are you thinking about selling your house in Peru? In addition to a traditional listing or a direct sale, you can sell your house via a rent to own agreement. For many people, it is proving to be the solution they have been looking for when it comes to selling their Peru homes! Learn more about the pros and cons of selling your house via rent to own in our latest blog!
Have you ever considered using a rent to own agreement structure to sell your Peru house? It can be an excellent way to sell if you do not the need the money from the sale upfront in its entirety. Here are a few pros and cons to consider before selling via rent to own.
Pros of Selling Your House via Rent To Own:
Get The Price You Want
When you select a rent to own agreement to sell your Peru house, you stand to benefit in several ways. Initially, you’ll receive a substantial deposit. Moreover, the monthly rental rate is typically higher than that of a standard lease. This allows you to determine the selling price and establish terms accordingly. Each month, a portion of the rent contributes towards the house’s price. Upon completion of the rental term, the tenant has the choice to purchase the property at a predetermined price. This arrangement guarantees the agreed-upon house price regardless of market fluctuations.
More Potential Buyers
By implementing a rent to own arrangement, a broader pool of prospective buyers will have the opportunity to make a purchase. Numerous individuals who are eager to buy presently may face challenges in meeting the requirements for a conventional loan. By offering them the option to rent with the possibility of purchasing at the conclusion of the rental period, you afford them the time to improve their creditworthiness and financial standing, thereby enabling them to qualify for a loan to settle the remaining balance of the purchase price.
Steady Income Stream
When you own a rent to own property, you’re essentially creating for yourself a monthly income stream, as long as the agreement is in place. With this arrangement, you’ll have highly vested tenants who are committed to eventually owning the property and will pay you each month to live in the home. This setup offers the potential for a stable income source while also providing tenants with the opportunity to work towards homeownership.
Good Tenants
If someone plans to buy a home in the future, they won’t mess it up. Instead, they’ll take good care of it, just like it’s theirs. They’ll also make sure to pay rent on time because breaking the rental rules can cancel the contract. This means they’ll keep the house in good shape and pay the rent without any problems.
You Keep The Money No Matter What Happens
If the potential buyer decides not to proceed with the purchase at the end of the rental term, any payments made will remain with you. This includes both the rent payments and the initial deposit, which you will retain.
Cons of Selling Your House via Rent To Own:
It Will Take Some Time To Get Paid
It’s unlikely that you’ll receive the full balance of the home sale for a couple of years, especially if there are ongoing mortgage payments or other financial arrangements in place. However, if you don’t immediately need the money for another purchase or financial obligation, this delay shouldn’t pose a significant issue.
No Guaranteed Sale
Your potential buyer might decline the option to buy at the end of the rental term, perhaps due to financial constraints or having found a property better suited to their needs. However, this doesn’t necessarily spell trouble. In such a scenario, you still benefit by retaining the deposit and any increased rent that was collected throughout the rental period.
Miss Out If Prices Surge
Once the agreement is made, sale prices are locked in, meaning that if the market experiences an upward trend, there’s a possibility of missing out on additional profits. Conversely, if the market undergoes a downturn, the agreed-upon sale price remains unchanged, ensuring stability despite market fluctuations.