Can I Refinance My Rent To Own Property?
Posted: Sunday, January 17, 2010
by Rhiannon Wilkinson
Rent to own (or) lease purchase is essentially another way of saying "glorified tenant."
The only benefit you have as a rent to own tenant is if you fixed the purchase price in place at a really good buy. For instance, if the house is worth $100,000 and you still have opportunity to buy it for $70,000 a few years down the line.
With this being said, there are some lenders who consider your rent to own contract to be the same as a down payment or what is called "seasoning" the note, and proving your payment history. But a lot of these lenders have fallen off the face of the planet due to the economy.
If you DO own property in your name, then you cannot qualify for the tax credit. So, it is wiser to refinance, if you can. One thing you might ask the owner is if he would be willing to put the property in a land trust with your name on the trust. It's not the same thing as slapping your name on the title of the property. A trust has very clearly defined outlines and agreements between buyers and sellers of the property. It gives the buyer a property interest WITHOUT all of the liabilities of doing so. If you can show your name on the property trust, you are more likely to qualify for a refinance.
You can google two real estate attorneys who are GREAT at structuring land trusts. Their names are (1) Bill Gatten or (2) William Bronchick
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