Tenant Wants To Rent-To-Own
I was at a tenant’s house today doing some repairs when she asked me if I would be willing to allow them to rent-to-own the house they are renting. While I think that these tenants are on the right track wanting to own a home, I think that they don’t understand what they’re getting into.
I read a book last year (at left) about investors doing this as an investment strategy. Basically, when I was finished reading it, I felt like the focus of their “strategy” is pretty much taking advantage of green home buyers. The authors of this book, in my opinion, specifically advocate practically swindling tenant-buyers, as they call them, by luring them into contracts where, statistically, something like 75% of tenant-buyers never go through with the deal thereby contractually handing the seller-landlord a sizable cash down payment for doing nothing more than entering into a contract.
That just would not sit properly with me. I’m not sure how the investors sleep at night after doing one of these deals. I guess that the Buddhist philosophy says it best. A good deal is one where all parties win.
It’s kind of like when investors buy foreclosures and then rent the house back to the person being foreclosed on. I guess that for the person being foreclosed upon, it may seem like a good deal at the time but I’ve also seen many disadvantaged people (old/poor/sick) renting from their buyer only to be mistreated because they have no hope of being able to move.
