RENT TO OWN:
WHAT IS RENT TO OWN?
Rent To Own enables the first time buyer to enter into a lease agreement and rent the house and at the same time receive an option to buy the house two years later.
The purchase price will be “frozen” for the two-year period, which means that the price will not escalate during the lease term
WHAT WILL I PAY PER MONTH?
If the Rent To Own buyer is then able to obtain a home loan before the expiry of the 36-month rental term, the full deposit saved will be deducted from the purchase price.
A deposit reduces the home loan amount required and usually enables a buyer to negotiate a lower home loan interest rate.
YOU CAN EVEN USE FLISP:
The Rent To Own tenant buyer will pay rental per month that is similar to a home loan repayment to get used to the obligations of a home owner, plus rates and taxes, as if in the shoes a property owner.
The unique benefit is that almost one half of the rental paid per month will be saved for the tenant buyer during the rental period.
The Rent To Own concept is now also recognized as structure for a Flisp subsidy under the National Housing Code that came into effect in 1 April 2022.
A first-time buyer will now have the opportunity, to apply for a Flisp subsidy and use the subsidy as a second deposit.
You will need a reasonably good credit score and income to support the monthly rental for the Rent To Own rental repayment as this will prepare you for a home loan repayment in the future
If your score is not so good at this moment, you can sign up for the Budget & Debt Repair Fitness programme to assist you to get your credit score and affordability in shape and fit enough for a home loan
Rent To Own also is linked to a FLISP subsidy and you can check your Flisp subsidy amount before you start. Once you received your FLISP Provisional Voucher, you can do an online check to find out the Rent To Own amount you may qualify for.
CLICK HERE FOR YOUR FLISP PROVISIONAL VOUCHER: