Selling your house in Kansas City can be simple when using a rent to own contract! There are a number of excellent benefits to selling this way that homeowners don’t always realize. Keep reading to learn more about some of these great benefits in our latest post!
Using a rent to own agreement or possibly holding the note when selling your house in Kansas City can be an excellent way to sell your house. The benefits to home sellers can be huge. You’ll be able to reach more buyers, you’ll have a much better shot of getting your asking price, and you will instantly turn your property into an investment that provides you with income month after month. If you need to sell your house in Kansas City don’t rule out a rent to own contract or other terms as, it might be the home selling solution you have been waiting for!
Some real estate investors like to purchase homes in this way as a means of letting the homeowner be the private lender. For example, here at kcmoHomeBuyer we have 3 or 4 people who have the cash to lend us to buy houses. They get a great interest rate for the use of their money or they partner with us on the deal. If you already own the home and don’t need the cash right away, you could partner with us by selling with a not or seller finance agreement, and earn a more on your house.
But how does it work?
Set A Realistic Down Payment
When using a down payment or option fee in a creative finance contract, the number needs to be realistic. If a buyer isn’t able to qualify for a loan due to lack of down payment, they aren’t going to be able to come up with one for you either. While you should require an option fee from your potential buyer, make sure it is something they can afford. Not something that will dissuade them from agreeing to the deal with you.
Use A Comprehensive Agreement
There are a lot of things that should be covered in a rent to own agreement. It is important to have a detailed contract that covers common situations buyers and sellers face. By using a detailed and comprehensive agreement upfront, you’ll be able to avoid any disagreements or disturbances down the road. A few of the things to include in the agreement include…
Repairs & Maintenance – It’s important to have a clear understanding of who is in charge of what. In many cases, minor repairs and maintenance costs will be the responsibility of the tenant/potential owner. Whereas if something major should go wrong, that expense will fall on the actual property owner. Let’s say the water heater busts a week after move-in. This cost won’t usually be the responsibility of the tenant.
Taxes – At the end of the day, the property taxes are the responsibility of the person whose name appears on the deed. Some agreements will take taxes into consideration, charging the prospective buyer a reimbursement cost.
Lease Terms – Some contracts last a year and others last three. As the homeowner, it is up to you how long you are willing to wait before officially selling the house. Some homeowners don’t mind waiting, while others will want the closing to happen sooner rather than later.
Contingencies – A properly set up agreement will offer contingencies for both the buyer and seller. The buyer cannot be expected to purchase the house if they discover something fundamentally wrong with the property that wasn’t disclosed upfront. While you want to find a buyer, it is also important to be honest and fair.
Foreclosure Process – Your agreement should outline the foreclosure process and what will put the tenant in violation of their agreement. Hopefully, you won’t ever have to deal with the eviction process, however, if you do, it will help to have all the details in black and white.
Miscellaneous Situations – Depending on your property and its location, there are miscellaneous things you should include in your contract. Like what happens if your tenant violates HOA rules? Or if they alter the house without following through on the lease? Or if a natural disaster damages the property beyond repair? There are lots of different situations that can arise. By anticipating them ahead of time, you’ll be able to avoid conflict with your tenants down the road.
References and Background Checks
While you are opening the house up to many more buyers, you can just go into an agreement with just anyone. You will need to do some research on your potential buyer by checking references and running background checks. You will want to make sure that the people you enter into a rent to own agreement with are able to pay you each month until they qualify for a mortgage.
You might check with a resource like www.RentPerfect.com to get a complete background check and credit history.
Use a rent to own contract to sell your house in Kansas City! Contact us today for more information!
More on Seller Financing
- Seller Financing Investment Property
- Seller Financing from Nolo
- The Ultimate Guide to Seller Financing
More on Selling Rent to Own
- How to Sell Rent to Own
- How does Rent to Own Work – from Dave Ramsey
- How does Rent to Own Work from Zillow