I do think rent-to-own deals were historically geared towad the seller not the buyer. That was why they were rare I think. But as we know now, nothing is on the sellers side now so I’m clearly negotiating with my hands tied behind my back.
Gn, I absolutely considered your scenrio. That if the house appreciates, they win and if my house depreciated why would they settle. It kept me up several nights as a matter of fact. It is a huge part of the risk. But my rationale is that if they do walk away, I’ve got some money from escrow and I’ve been renting all along, and I still have the house to rent or sell.
They did ask for a portion to be applied to closing, and I gave them the option of raising the rent and I would apply a portion or keep the rent they asked for and apply nothing. They chose the lower rent.
Their rationale was that they wanted to use the money to upgrade the house, specifically the bathrooms which are clean and functional but “low end” finishes. They felt that if they put in brand new bathrooms and then walked, I would have more “value” in the house and they would have to walk away from the money they spent on them. BS I know. Granite bathroom counters will be meaningless in a freeefall market. But it would show a personal investment in the buying of the house. They were adamant about this and they wouldn’t do the deal if they couldn’t immediately begin improving the house which they felt wasn’t to their standards.
And Radelow, they did get a fabulous deal. I admit, it is certainly not the deal I was hoping to do. But are you really surprised? I mean, you’ve been on this board. “Don’t be stupid and buy now” “If you own a home sell it now at any loss” “Its only going to get worse”
I guess what I really have is a tenant without any landlord problems and a possiblity of a sale in my future. But you know, I took what I could get.
Interestingly, my B-I-L just called me. He has been trying to sell his condo in South Forida for about 2 years now. And the market there I think is worse than anywhere. He was just offered a rent to own deal. Seriously. Because the buyers can’t sell their house. I really wonder if this is going to be new trend. Are any realtors on the board seeing this?
