Information about rent to own in frisco (Howe, Alto: short sale, lease) - Dallas - Texas (TX) - City-Data Forum

Mrscaston · 09-09-2010, 04:23 PM

My husband and I are renting a house in frisco and we love it so much that we would like to buy it from the homeowners. They haven't mentioned that they were selling but we would still like to purchase it from them. I've read horror stories about renting to own, can someone enlighten me on the process or suggest another way to purchase this home without having to go through the rent to own process?

Ryan Kirkpatrick · 09-09-2010, 04:57 PM

Don't do rent to own. I'm a Realtor and I can't find a reputable lawyer who would draw up a contract for this. To not go into too much detail, the Texas property code is very stringent on how these contracts are written and has basically been revised to do away with these agreements all together. This is because a lot of flat out fraud was taking place under these agreements with land lords taking advantage of illegals who were hoping to buy the home once they made their last payment. Needless to say, many times that did not happen and there was nothing they could do about it.

There are only three solid ways to purchase a home.

1.) Get the classic financing from a bank
2.) Buy it in cash
3.) Seller financing should the seller be interested in doing this, which most are not because it requires a lot of work rather than just selling it out right. If you can get the owners to try on seller financing for size, and try to entice them maybe by offering a higher rate (like 6 or 7%) on their money, then maybe you could work something out.

I repeat again, do not enter into a lease purchase (rent to own). Ebby Halliday as well as my firm does not even allow their agents to do this contract because at the very least, there is no legal way to mix and match our contracts together to make this a solid contract.

Ryan

nsumner · 09-09-2010, 06:03 PM

Since you are already renting the house, there is no need to change it to a rent to own unless you want some of your rent amount applied towards the sales price. Your first step is to find out if the owners are willing to sell.

RTO requires you the tenant to put down non-refundable money should you not be able to purchase the house. This is one of the reasons the RTO laws in TX have become strict and agents cannot and are not allowed to write such contracts. Too many disputes over the downpayment.

Get yourself qualified for a loan, this is an easy process then approach the owner with an offer and see what happens.

Naima

momof2dfw · 09-09-2010, 06:07 PM

As already said, most agents and firms do not allow their agents to participate in these types of contracts. You don't even see them advertised any longer. And for a good reason.

With interests rates as low as they are........... get with a good mortgage broker and get your own financing. However, the owner may not want to sell if the house does not appraise for what they owe on it. It might be better for them to just keep renting it out until they are in a better situation to sell it. You never know till you ask though.

FalconheadWest · 09-09-2010, 06:08 PM

Quote:

Originally Posted by Ryan Kirkpatrick

Ebby Halliday as well as my firm does not even allow their agents to do this contract because at the very least, there is no legal way to mix and match our contracts together to make this a solid contract.

NO agents in the state of Texas are able to do rent to own. It's not just your broker and Ebby.

Ryan Kirkpatrick · 09-09-2010, 06:21 PM

I can name a few who do, but obviously I'm not going to do that on here. I'm not sure where you picked that up, but it should be a hard and fast rule and I obviously agree with you.

Squirl · 09-09-2010, 06:44 PM

You could ask if they'd be interested in amending your present Lease to a Lease with option to purchase; possibly they would be receptive to that and your security deposit could be converted to you earnest money if you decided to execute the option and you could ask that a certain portion of your rent be applied toward the purchase price or closing costs. That's a way to at least start the conversation.

FalconheadWest · 09-10-2010, 08:20 AM

Quote:

Originally Posted by Ryan Kirkpatrick

I'm not sure where you picked that up...

I "picked it up" because it's considering Practicing Law and no agents are allowed to practice law unless they're an attorney also. If you know of agents doing this, you need to report them under the Code of Ethics if they're a "REALTOR®" or to TREC if they are just licensed agents.

Ryan Kirkpatrick · 09-10-2010, 08:37 AM

Or these agents have a lawyer draw up the docs....

Mrscaston · 09-13-2010, 09:02 PM

Thank you for all the responses, sorry I didn't reply sooner, didn't get the notification. I think we'll try to conventional options because we certainly don't want to get screwed in the end. We have good credit so that isn't an issue but we really like the house so we were trying to secure it so to speak. We have no idea if they are interested in selling but that'll be something we'll ask in the next week or so. They purchased the house in a short sale for $216k and I don't know if that gives us any leverage, one can only hope.

Ryan can you explain a little more what seller financing is?