tokar429
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since you do not have a down payment or otherwise manage to qualify to be able to purchase a condo on your own, you can rent to own. in the simplest terms, you are only a tenant renting a suite in which to live in. your new 'partner' in the home is only acting as a guarantor in the event that you do not pay the 'rent'. should you decide to move out, you will lose everything you paid to your landlord/partner. just as if you rented any other rental unit. but if you stay on, eventually, the owner will accept what or a portion of what you have paid in rent as a down payment in order for you to go to the bank and obtain a mortgage to purchase the unit you are living in. these can be great ways to become a homeowner for those that could not otherwise qualify. when you buy a condo keep in mind that not only do you have the mortgage payment, but the maintenance fees, taxes, and ALL the utility bills not covered by the maintenance fees (aka strata, condo, property, or any other named fees) every month. so be careful and watch your budget.
should you decide to give this a try, you won't lose as you have to live somewhere, and when you rent, you are only paying off someone else's mortgage. BUT before you sign that final signature, make sure you see a lawyer to make sure you can get out of the deal without any penalties, and for any safeguards you could have.
figures for example only. you move in with a condo market value of say $100,000. you stay for 5 years at $500 per month rent. that is $30,000. less expenses such as taxes, maintenance fees to the building council, and the plumber to fix that leaking tap, and some other costs are deducted, your payments to the mortgage total only $15,000. BUT the value of the condo has gone up to $200,000, and $15,000, plus the $5,000 you have saved isn't quite enough to qualify for your own mortgage, so you go it again thinking you are getting ahead. then 8 years after moving in, you really like the area, you have a child or two, and you think life is good (ok fine - it is only fair) but you still do not own the unit you are living in. there is no mention of your name on the title. the guy you made the deal with is going to sell outright because he has to move back to the old country. you get no notice of this until a letter comes from a lawyer stating that the unit has been sold and you are to send further rent hecks to, or worse, this is your notice to vacat as the new owner wishes to occupy.
although this can be a good thing, you had better see a lawyer BEFORE YOU SIGN THE LINE. |
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