How It Works
When you decide to rent to own, you will be required to sign a contract for the purchase of the home after a specific amount of time. Usually this is from one to two years from date of agreement. During that period, you will be paying rent to use the property. A portion of your rent will be applied to a separate account where it will accumulate towards the down payment on the home.
When the rent option is over, you will need to purchase the home. All of the extra rent money that was saved back, plus your initial deposit will be applied to the down payment on the home. Once you have secured a mortgage, the house will transfer over into your name.
Renters will be required to place deposits down on the home, much like they would a rental property. Unlike a rental, however, the renters will be responsible for all of the repairs and maintenance necessary on the home at their own expense. Additionally, depending on the contract signed, the renter may also be responsible for taxes on the property.
If, at the end of the rental period, you decide not to purchase the home, all the money paid into the rent will be legally converted into rent money and you will not receive a refund for the additional amount that you applied towards the down payment of the home. This is the one drawback to making this type of Ulster County real estate purchase.
With the many homes for sale in the area, it is important that buyers shop around for the best deal and a payment plan that is in their best interest. Working with a qualified Ulster County real estate agent will help you maneuver through the different options available to purchase a home.