Hi i have a property that was on the market but took it off due to everybody doing the christmas sell off. But have been lucky to rent it out, to a lady that is keen to buy it after 6 months due to her new job. I would like to lock her into a rent to buy contract. Are they a standard type or do you get one done through your own lawyer?? Can somebody help me in finding the info i need.
Many Thanks TRUDE[strum]Why dont you just get her to sign a contract to buy with a settlement date 6 – 12 months away? And no penalty if she pulls out.
That is certainly an attractive deal for someone after their first home.
So you get rent and a sale and she gets a locked in price and time to save a deposit. Perhaps the value might be higher.
Plus she might even treat it as her own home rather than a dodgy rental property [biggrin]
Simon Macks
Residential and Commercial Finance Broker
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
Thanks Simon,
I have heard of a rent to buy contract that, the tennant(buyer to be) puts a small deposit down and if they at any time default on a rent payment then the contract is nul and void. Looking at seeking more info on this type of contract
Trude
Trude, which state are you in?
Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe†in subject line.Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
These contracts are very state-specific and tie in with all sorts of regulations and legislation relating to real estate law.
Not only are they state-specific but also property specific and specific to the vendor’s and purchasor’s individual circumstances.
Legislation can be very easily breached even if it is not intentional. Something as simple as forgetting to add a clause waiving the cooling of period in the annexed residential contract could make the whole contract “void” and the entire option consideration becoems “refundable to purchaser”.
Even if someone does take you up on your offer and gives you a “standard” contract, don’t use it. Real estat law is huge and if you are not familiar with the legislation, use a solicitor!
I do rent to buys for investors all the time and each time I always run everything past our solicitor.
Rick Otton has done hundreds and I believe he always uses a solicitor for each contract too!
Do yourself a favour and get a taylor made contract to suid your purpose!
Investment Property Management
http://www.adprop.com.auHi Trude
Karen and I operate mainly in NSW and Qld. In NSW we use Tony Cordato for our contracts, including Rent To Owns (a lease and an option to purchase). In Qld we use Paul Brennan.
Good luck.
Cheers, Paul
Paul & Karen Dobson
negative2positive
Turn your negatively geared property into positive cashflow.
Phone: (02) 4984 9540Talk to us about Wrap Training Joint Ventures.
Paul Dobson | Vendor Finance Institute
http://www.vendorfinanceinstitute.com.au
Email Me | Phone MeAn alternative way to finance your home.
Hi Terry
I’m in the Northern Terrority
Trude
Hi Paul thanks for your reply but the property is in Northern Terriorty so i may just go to a lawyer and see what they come up with
Hi Trude
Karen and I operate mainly in NSW and Qld. In NSW we use Tony Cordato for our contracts, including Rent To Owns (a lease and an option to purchase). In Qld we use Paul Brennan.
Good luck.
Cheers, Paul
Paul & Karen Dobson
negative2positive
Turn your negatively geared property into positive cashflow.
Phone: (02) 4984 9540Talk to us about Wrap Training Joint Ventures.
[/quote]
Hey Trude
Try calling a friend!!!Phil
Hi
there’s a guy called rick otton who has made millions doing the “rent to buy” thing. try his website, http://www.rickotton.com or http://www.webuyhouses.comLesley[evo]
Hi all
I am in WA and are pondering rent to buy option for my current reno that is on the market.
Can anyone recommend a scolicitor in Perth that is familiar with these?
Also, is there anyone out there who has done this in WA that I could have a chat to?
Celeste
Hi Trude
We are using Rick Otton's contract for this purpose. I took it to our solicitor in Brisbane. He said "I hope you didn't pay a lot for this, because it's the same as the ones we use all the time for developers".
It was part of a pack, and I am very happy with the price we paid BTW, but the point is that if you go to the right lawyer (one who is skilled in property and contract law) you will have little difficulty.
And I get him to fill it out, and create the regular REIQ contract and PAMD stuff (for Qld) that goes with it. In fact he is sending me a prepared one this very day for our latest Rent-To-Own dealLotsa good advice above in those other posts. Why stress yourself? A solicitor costs little in comparison to the agro if you make a little mistake. Build the cost into the deal and get the customer to pay for your solicitor. We do.
Cheers
Mr Fair Go
Hi all
Another question, On the rent side of things, do you still charge the bond and rent in advance? Is the extra rent amount that is used as a creit included on the rent docs or the option docs?
Basically is it a standard rent situation in regards to $ bond / rent in advance / rent and then you add an extra contract which is the option and includes the option deposit and the extra rent that is to be credited?
Celeste
"Basically is it a standard rent situation in regards to $ bond / rent in advance / rent and then you add an extra contract which is the option and includes the option deposit and the extra rent that is to be credited?"
Yes.
Usually you would write in the option contract that you will ONLY give rent deposit credit for weeks where the rent was paid on time. And if they do not go ahead and take up their option they forfeit all rent paid.
Thanks my fair go
I had a home open today, advertising the rent to buy option. I have had 3 replys and would you beleive the REA rang to say he has a couple wanting to put in an offer to buy Monday!!
no.1 – just cannot afford a mortgage of more than $150k and he is 75yrs lod, so he will not do
No.2 – wants 4 beds, all tho she is going to call me tomorrow to see if it is still on the market.
no. 3 – was an internet inquiry. I have just answered it, so waiting on his details,So looking good so far, I didn't think anyone knew what a rent to buy situation was!! I even spent 3 hours typing up a very professional looking fact sheet !! That I haven't needed
If I sell this one the normal way, I still have the one next door which will be ready in 3-4 weeks.
I have found a lawyer thru my accountant who knows all about it.
Anyway thanks for all your help.
Celeste
Way to go, Celeste!
Tip: Keep marketing even after you think you have a buyer. Until they sign on the line, keep marketing.
Cheers
Hi Mr fair go
I am still getting phone calls today – excellant.
I still haven't got the offer in writing, very frustrating waiting, waiting.
Especially since the response to rent to buy has been so good. I am champing at the bid to sign some one up!!Celeste
Hi Celeste
Don't wait for THEM to create the offer: YOU get your solicitor to do it as if from them, and they sign it. Nowhere is it written that the buyer HAS to create the offer! BTW, write in the option that they pay for your solicitor to prepare the docs.
Get some deposit first though, you don't want to be spending money at your solicitors and they back out. At the very least get them to give you a cheque made out to your solicitor for whatever amount he has quoted to prepare the docs. (Ours charges $770 inc for a Vendor Finance, and $220 for a Lease Option)
If you wait for them to go find a solicitor who knows how to do this you will lose the deal is most cases, coz they just don't have the same determination as you to make it happen.
Hope this helps
Hi Mr fair go
I have prepared the following:
– a facts sheet outlining the basics with a list on the back of why it's good for them
– a sheet with 3 differnet options – different for them pretty much the same end result for me.
– a brief contract – more like an offer/acceptance form, which outlines the main option points ie: the option premium / rent / option amount / what gets credited / expiry date / rates who pays / maint who pays etc. I also have a bit on the bottom which they sign saying I have explained to them and they understand what happens if they default / do not take up the option etc. – basically if you default you loss the credits etc.I have a solicitor on the ready to draw up the option. I also, keep $1k of the premium for legals etc.
I had 2 thru on the weekend, but they can only afford $250 pw ? no way will they get a mortgage for around 300k.
I took a couple thru last night, they signed up. Then when I looked at thier income and his work history (she told me she was on a disability pension due to a disabled daughter / I was a bit sus and asked her a couple times – is it a pension or single parent ?) , I thought they can afford a mortgage so why not just buy it right away!! The fellow said yes. But oho I didnot have my offer and acceptance for sale with me, so I said I will go home draw them up and pop around.
As I was driving home I thought to my self – these guys a really young and not real bright, I should organise a broker to go see them and sort a mortgage out for them, I do not want to put anyone in a position where they loss thier money. I rang them and she said – we have decided it's to small!! I was right it's a single parents payments – she not supposed to have a fellow living with her. So no way would they get a mortgage now or by the expiry date.
Anyway, I will carry on trying. to either sell or rent to buy.
Can I send you PM's with questions?
Celeste
Hi all
Lets hope I know what I am doing!! As I have just signed up my 1st rent to buy tenant/buyer!!! and she is thinking about rent / buying nest door and it's not even finished!! Not even 1 week from my 1st ad.
Yipee!! Lifes good!!
Thank you for your help over the last week, wish I had heard of it earlier!
You must be logged in to reply to this topic. If you don't have an account, you can register here.
