The New Trend In Denver Home Sales: Rent To Own

Selling property using a rent to own agreement is becoming increasingly popular with homeowners in the Denver area! The process is underutilized and can be beneficial for both the buyer and seller when structured properly. Learn more about how to do it in our latest post!

While a rent to own sale may not be the first thing you think of when selling your house in Denver, it can be a beneficial option in the right situations! If you want to open the door to a whole new market of buyers, consider the many benefits a rent to own agreement can offer you!

How Does It Work?

When a tenant or buyer enters into a rent to own agreement, they are agreeing to pay (an often increased) rent each month for a specific period of time. There will likely be a down payment made to the owner in order to secure the contract. Once the rental period has elapsed, the tenant will need to either obtain a loan to purchase the property outright from the buyer or walk away from the deal, thus losing and deposit money they had invested.

Term of The Contract

When a homeowner and a tenant enter into a rent to own agreement, there are a number of terms that will need to be agreed upon before the contract is signed.

Lease Term

How long will the tenant be able to rent the property before a purchase? Typically, the rental period will last 1-2 years.

Down Payment

In many cases, a tenant will make a down payment to the homeowner to secure the contract and to show good faith. While this amount won’t be as high as the down payment for a traditional bank loan, it should be enough to keep the potential buyer from easily backing out.

Monthly Rent

To some extent, the seller is doing the buyer a favor by allowing them to rent before actually buying. While the process has many benefits for the seller, a rent to own agreement will open the door to home ownership for people who likely wouldn’t have been able to do it otherwise.

Maintenance

Typically, the tenant will handle the maintenance of the property during the rental period. This should be discussed between the buyer and seller and detailed within the contract.

Taxes

The tenant will also likely take on the property tax payments. This alleviates a large cost for you as a homeowner.

Credit

With the deposit from the prospective buyer and the increased rent each month, many agreements will state that a portion of this money goes toward the down payment on a traditional loan.

What Are The Benefits?

Get Your Asking Price

When you use a rent to own contract to sell your house in Denver, you will open the property up for many more potential buyers. As such, there will be more interest, giving you the opportunity to easily secure asking price within the terms of the loan.

Higher Rent

Houses under a rent to own agreement often collect a higher rent each month. While some of these funds may be used toward the tenant’s down payment on the home, you will still be able to see great profits, as well as the security of having a tenant in place throughout the duration of the lease term.

Deposit

If the tenant defaults on the agreement, the deposit and the amount paid in rent, is yours to keep. You might be back where you started, but you will be there with more cash in your pocket.

How Do I Get Started?

To get started you will want to find the right tenants to enter into the agreement with. Draw up a contract detailing every aspect of the agreement as mentioned above. Have your lawyer review the contract to ensure everything is in order. Metrowest Real Estate Services can make the entire process of offering your property via a rent to own agreement simple and profitable.

Contact us today to learn more about selling your Denver house via a rent to own agreement! (720) 932-4402

Ken Blevins

Ken Blevins, CEO of Metrowest Real Estate Services, is a veteran in mortgage and default servicing with more than 24 years of experience in collections, foreclosure/bankruptcy, loss mitigation and real estate disposition (REO). Blevins was an original co-founder of Metrowest in 2003, a Real Estate Brokerage and Services Company focused on the resale, recovery and liquidation of distressed real estate in Denver, Colorado and surrounding metros. Blevins assumed the role of CEO in January 2014 and provides strategic direction and has management accountability for the day-to-day operations. Under his direction, Blevins drives all default management operations to maximize asset value recovery and reduce loss severity through a strategy focused on customer service and state of the art technology. Blevins has 18 years of direct operational experience in all facets of REO Asset Management having managed large national REO Disposition contracts for Fannie Mae, Freddie Mac, Wells Fargo, JP Morgan Chase, CitiFinancial, GMAC Mortgage and other various financial institutions. Blevins specialties include REO asset management, real estate investment, bulk REO acquisitions and distressed asset recovery and liquidation, and he has directed the resolution and liquidation of over ten billion in institutionally-owned residential real estate.

Looking For Local Rent To Own Homes?

Join our FREE local rent to own homes list below.

Do I Qualify?

Fill Out This Simple Form To Be Pre-Qualified For The Rent To Own Program.
    What is the total combined income of everyone in the household over the age of 18?
    We help those with low or no credit get into great homes. But knowing where your credit currently stands helps us have a better idea of your specific situation.
  • Please enter a number from 1 to 6.
  • Please enter a number from 1 to 5.
  • Contact Information

  • The better we know you the better we can help you find the perfect home you're looking for. Thanks!
  • This field is for validation purposes and should be left unchanged.
Apply Now!