Which kind of deal gives you the best overall return for the least risk?
2 thoughts on “If you're selling a house, is rent-to-own better than providing seller financing?”
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Which kind of deal gives you the best overall return for the least risk?
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If you are the seller, rent to own is the better way to go.
1. Only part of the rental payment goes to paying off the home, so you make more money.
2. They are renters and you can evict then instead on having to foreclose on them, which is cheap, easier, and faster.
The down side is you are still a landlord and have to fix stuff when it breaks.
neither is better than the other, and each has there risks. The condition of the property and the credit worthiness of the buyer come into play here.
don;t do the rent to own unless the person can provide a pre-qualification from a lender right up front…in fact i would not even show it to anyone without them having a pre-qual letter in place.
when you advertise a rent to own, every dredge of society will be interested. prepare for your phone to ring off the hook with calls from psychos. I just went through it myself and it took about 100 calls to find someone half way decent.
Owner financing can be good, but if they default your looking at a few thousand dollars to get the property back, and if they declare bankruptcy, it will be tied up forever