Rent-to-Own Program 2
Updated December 4, 2021The primary purpose of this Program is designed for people that have already been thoroughly pre-Approved and successfully pre-Underwritten by one of our affiliated Lenders before beginning the property search.
Program Features:- The primary purpose of Program #2 is designed for people that have already been thoroughly pre-Approved and successfully pre-Underwritten by one of our affiliated Lenders before beginning the property search.
- On this specific Program # 2 You are basically agreeing to purchase the home from the Investor within 30 days.
- Your Mortgage Loan should Close within 30-Days after the Investor purchases and Closes on the subject property to qualify for a 1% Purchase Transaction fee + Pay the Cash Closing Costs that allowed the Investor to purchase the home on your behalf. The "Cash" Closing Costs are substantially less than a Mortgage Loan Closing Cost. Depending on the price of the house, we estimate Cash Closing Costs to be between $3800-$4500
- This program is also meant to directly compete against typical "Cash" Home Buyers or very highly qualified Conventional Buyers that are authorizing Purchase Offers to be written without the normal protections such as Appraisal, Inspection and Financing Contingencies.
- This program is designed for people who can close within 30-Days, NOT 31-Days.
- If the Buyer only wants to pay a 1% Purchase Fee + The cost of the initial Cash Closing Cost, which the Investor paid initially so a Title Company could be used to Close on the property.
- This process enables you, the Tenant/Buyer, to purchase and finance the property in your name.
- Program # 2 is Not a "Try and Buy" program as is Program #1.
- Program requires the Tenant/Buyer 3% down payment on the Property + 1 months' rent.
- The Investors goal for this program is to immediately sell the property to you and close that transaction within 30 days after the Investor purchases the property on your behalf.
- There are no Appraisal or Financing Contingencies used by the Investor when purchasing the property. In Program #2, all Home Inspections repairs are Disclosed to the Tenant/Buyer.
- This unique program is best used with the following Buyer profile. Seasoned Home Buyers who have excellent credit and cash reserves and who have already been pre-Underwritten by one of our affiliated Institutional Mortgage Lenders.
- Qualification criteria and all Lease and Purchase Costs are explained for each property before you commit to sign the Lease and Option to Purchase. Your approved purchase and lease costs will depend on how much you qualify to spend every month for a mortgage or Rent. The equation is very similar to qualifying for mortgage Loan.
- You pick the house in an approved subdivision on our MLS websites.
- The Purchase price is calculated very similar as if you were taking out a mortgage loan (with or without Down Payment Assistance).
- Most of the acceptable properties are in your local MLS for sale right now. Please contact Mid Florida Realty to get set up to receive Multiple Listings Service in your area of Florida.
- Monthly Lease with Right to Purchase prices are disclosed before signing the Lease and the Option to Purchase agreements. There are No surprises, you are fully aware in this transparent process.
- You have up to 2 years to either rent/lease the property or purchase the property before you either decide to purchase the property or leave property.
- Your NON-refundable Security Deposit/Earnest Money Deposit is 3% of the agreed Purchase price of the property. This 3% can later be used as part of the down payment when you are ready and able to purchase the property.
- Every month that you do not purchase the property from the Investor, this means the Purchase Fee goes up 1% every month. Consequently, if you wait 12 months to purchase the property, your purchase fee goes up 1% per month to 12% per year up to 24% Purchase Fee for 2-Years, NOT a 1% Purchase Fee as if purchasing the property in first 30 days.
- You have the Right to Purchase, but if you decide NOT to purchase within 2 years, you lose your 3% Earnest Money Deposit.
- Again, you'll find that with this program, the monthly lease, plus Renters insurance is pretty close to what the actual mortgage payment will eventually be once you opt to purchase the property and the property is Closed and financed into your name.
- This program is designed to successfully compete with aggressive competitive Buyers Purchase Offers that don't have any Appraisal, or Financing Contingencies to protect the typical First Time Home Buyers or typical seasoned Home Buyers that don't have at least $35,000 in Cash to risk without an Appraisal Contingencies, Inspection Contingencies, or any Financing Contingencies.
- Mid Florida Realty will set you up to receive the Multiple Listing Service in your area of Florida.
- Monthly Lease with Right to Purchase prices are disclosed before signing the Lease and the Option to Purchase agreements. There are No surprises, you are fully aware in this transparent process.
- Qualification criteria and all Lease and Purchase Costs are explained for each property before you commit to sign the Lease and Option to Purchase. Your approved purchase and lease costs will depend on how much you qualify to spend every month for a mortgage or Rent. The equation is very similar to qualifying for mortgage Loan.
- The monthly lease/rent payment is calculated very similar, as if you were taking out a mortgage loan (with or without Down Payment Assistance).
- Most of the acceptable properties are in your local MLS for sale right now. Please contact Mid Florida Realty to set you up to receive Multiple Listings Service in your area of Florida.
- Monthly Lease with Right to Purchase prices are disclosed before signing the Lease and the Option to Purchase agreements. There are No surprises, you are fully aware in this transparent process.
- You have up to 5 years to either rent/lease the property or purchase the property before you either decide to purchase the property or leave property.
- Your refundable Security Deposit equals 2-months' Rent, which you can use for your future Closing Costs when you are ready and able to purchase the property. No pressure for you the Buyer, there isn't a typical stressful Offer process you have to go through like the Investor does when they purchase the house for you with their "cash" offer.
- If you decide to purchase the property, you can use the 2-month Security Deposit to pay some of your Mortgage Loan Closing Costs when you are able to purchase the property.
- You have the Right to Purchase, but there is absolutely no financial obligation to buy the home if you decide it’s not for you.
- You'll find that with this program, the monthly lease, plus Renters insurance is pretty close to the what the actual mortgage payment will eventually be once you opt to purchase the property.
- You don't waste an incredible amount of time viewing house after house that you probably won't get because you don't have a lot of Cash to gamble on the EMD/Earnest Money Deposit.
- This is especially true if you are an FHA, USDA, or VA Borrower. Again, since 2019 the housing supply (inventory of homes for sale) and demand ratio has gotten progressively worse with no end in sight.
- The Investor gives you the advantage of using their Cash to satisfy the Sellers notion of "Cash is King"!
- The house is thoroughly inspected by a licensed Home Inspector prior to the Investor purchasing the property on your behalf. The Investor negotiates with Seller for repairs.
- Ability to purchase the property from the Investor within 30-days from the time the Investor Closes for a fee of just 1% + Acquisition Closing Costs.
- Generally speaking, you can purchase a Home anywhere in the State of Florida, Obviously, subject to Investor approval.
- It doesn't matter whether you're an FHA, VA, Rural USDA Borrower when it's time to Close. You already live at the Property!
- You'll be working with a very experienced Realtor from Mid Florida Realty that's also either a currently licensed Mortgage Loan Officer, at one time was a Mortgage Loan Officer, or has been extensively trained in over 20 Down Payment Assistance programs, as well as this exceptional and very fair Buyer Rent to Own Program.
- In order to only pay 1% + Acquisition Closing Costs, property must Close within 30 days after the Investor Closes on the property. The fee escalates 1% every month that the home has not been closed on by the new new Tenant/Buyer. Example: If the property is fully purchased by the contractually bound Buyer (You) 12-months from the initial Closing. The Purchase fee of 12% is added to the new purchase price of the home.
- Buyer must have 3% + First Month's rent and escrow it with the Investor, prior to initial Contract acceptance. This is NOT "a try and maybe buy" program. You are committing to purchase the property.
- Down Payment Assistance programs cannot be used to fund the Investors 3% cash deposit requirement.
- Buyer/Tenant must have 3% down payment of their own Cash prior to beginning the home search and held in Investors Escrow account for Buyer/Tenants Earnest Money Deposit and/or Down Payment on the subject property.
- We typically do not recommend this program for First Time Home Buyers unless they completely understand all the Investors conditions and have completed the full Mortgage Underwriting process.
- Only available in certain large appreciating Metro areas, such as Hillsborough (Tampa Metro), Manatee (Bradenton, Parrish), Sarasota, Lee (Estero, Bonita Springs, Ft Myers,), Charlotte, Collier, Pasco (Land O' Lakes, Trinity, Lutz, Wesley Chapel) Polk (Lakeland), Orange (Orlando, Osceola, Winter Garden, Lake Leesburg, Tavares, Eustis, Minneola, Clermont), Seminole (Altamonte Springs, Sanford, Lake Mary, Oviedo, and Duval Counties (Jacksonville).
- Other Flood Zone, geographical, or some HOA community restrictions may apply such as someone has to live at the premises for 1 full year prior to that person or Entity leasing the home.
- Non-Refundable Rental Application Fee once you agree to have your credit and background checked is $500.
- Lease to Own and Rent to Own Programs must be approved, if there are any HOA or CDD Restrictions.
- This program is a little riskier than program #1, but it fits some people's needs very well. With program #2 You need to be fully committed to purchasing the Home within 30-Days. The Tenant/Buyer has been pre-Underwritten by one of our affiliated Lenders and they are ready to Close on a house.
- The Tenant Buyer should have some extra cash if the newly (Investor) purchased property doesn't quite appraise when it's time for the Tenant/Buyer to exercise the Purchase Option and institutionally finance and purchase the property in their own name.