Rent to own houses in Michigan are a great option for those who want to own their own home, but don’t have the upfront cash to do so. The idea of rent-to-own is that you pay rent on the home while you’re waiting to buy it. It’s like a lease-option, but instead of paying rent, you pay a portion of the price of the home.
How Rent To Own Homes Work
First you need to find your dream home. There are a lot of RTO portals online where you can browse rent to own homes in Michigan. Rent-to-own homes work much like traditional leases. You sign a contract with an option-to-buy clause and then move in. Once you move in, you start making monthly payments on the house. These payments go toward buying down your option price until it reaches zero and you can purchase the home outright. When this happens depends on how many payments you’ve made and how many more payments are needed until your option price is paid off.
In addition to making monthly payments, there may be other fees associated with rent-to-own homes as well – such as application fees or closing costs – which can add up over time if they aren’t included in your rental payment amount each month.
The amount of time it takes to buy a rent-to-own home in Michigan varies depending on how much is left on the option price and what type of financing you use. For example, if the option price is $100,000 and you’ve made four payments totaling $20,000 but still have $80,000 left to pay off, it would take about 20 months for your initial investment ($20K) plus whatever extra money is needed for closing costs (if any) to be paid off.
If you use a conventional loan, it typically takes about two months to close on a rental-to-own home. In this case, you would make four payments totaling $20K and then have the option to buy the property for an additional $80K. With an FHA loan, however, it can take up to six months or longer for your down payment plus closing costs (if any) to be paid off.
