Please note, Mortgage Broker Store has Discontinued the “Sell and Rent Back” Program Due to Market Conditions. For more information, please visit our latest post here: Discontinuation of Our “Sell and Rent Back” Program Due to Market Conditions
Here is some information on a program some companies that buy houses for cash use to allow sellers to stay on as tenants for some time. The Sell and Rent Back option is becoming more and more popular. Read on to find out how this technique benefits the seller in certain circumstances.
Cash home buyers in Ontario provide a quick sale option and the possibility of letting the sellers rent the property and live as tenants. This process works well for people who need cash quickly and don’t have a new address to call home right away after they’ve sold their existing home.
These agreements can be beneficial to both the seller and buyer.
- The seller doesn’t need to move right away and can save on moving expenses.
- There are no hidden fees or other expenses in the Sell and Rent Back Option.
- There is no mortgage, property taxes, or property insurance to pay.
- The seller doesn’t need to go through open houses but they can get a guaranteed term whereby they can live in the house rent-free.
The cash home buyers have good reasons to like this process too. Buyers can add to their income through a rental agreement. The extra money can offset closing costs and mortgage payments.
Generally, this is an excellent option for people who have a good amount of equity in their home with plans to move to another address. Please read on to find out more about how this works.
Can I Sell My House and Still Live in it Rent Free?
First off, it’s important to remember that many people who are selling their homes quickly are facing financial or other difficulties forcing them to move. Some don’t have a place to go right away and not a lot of extra money.
That’s why some cash house buyers in Ontario tweak their Sell and Rent Back Option to allow former homeowners to live rent-free for some time.
These companies ask for a discount on the property when they make an offer. In exchange, the sale has some customized terms included. The buyer allows the seller to live in the property rent-free for a specific amount of time.
“We do this one a lot,” says Jonathan Alphonso from the Mortgage Broker Store.
“Basically, we ask for a sizeable discount on the property, and in exchange, we write custom terms into the agreement of purchase & sale.”
He goes on to explain how the process works.
“Let’s say they give us a $50,000 discount. In exchange, we’d add in a term where they can live in the property free for 1 year, with monthly rent payments after.”
Alphonso says this technique works for both of the parties involved.
“We accept a discount on the sale price as a kind of “payment” for future rent,” he says.
Of course, there are other options for the sellers who want to rent their former homes.
Can I Sell My House to a Cash Buyer and Live in it as a Tenant?
Cash buyers often purchase homes and allow the sellers to remain on as tenants. Usually, they can stay on the property for up to three years or longer. The amount of rent they pay is determined by the selling price and the home’s equity.
Have More Questions?
As Cash House Buyers ourselves, we can directly answer any questions you may have about the process. Since everyone’s situation is a bit different, we can look at your unique circumstances and give concise and actionable advice.
Here’s an interesting scenario that illustrates how this can work to everyone’s benefit.
A homeowner recently sold their house at a predetermined price that allowed the cash home buyer to not charge any property taxes and no mortgage for five years. That allows the company to tweak the amount of rent they charge the previous homeowner who wants to stay on the property.
In that situation, the seller was responsible for utilities like water, hydro, and gas.
Generally, the amount of money a seller gets to charge as rent is determined by several factors. These include:
- The overhead, expenses, and costs for a cash home buyer who recently purchased the property. These can include different things like property taxes, insurance, utilities, and of course mortgage payments.
- The overall worth of the property is also important. For some properties, the rent is usually calculated at up to 1.1% of the value of the home. However, special considerations can be made to the seller who wants to take advantage of the Sell and Rent Back Option in Ontario.
It’s important to remember that sellers who become tenants are no longer responsible for upgrades, maintenance, and property taxes.
Whether homeowners are planning on selling their property and moving on or renting it back, understanding how the cash buyer process works is important.
What Happens When a Cash Buyer Buys Your House?
Selling your house to a cash buyer is a simple straightforward process that doesn’t involve commissions paid to real estate agents, mortgages, and the anxiety of waiting to see if a buyer backs out at the last second.
These companies by your house AS-IS. That means the seller isn’t responsible for any upgrades or repairs. Generally, there are three steps to close a deal.
- A simple inspection is first. Cash home buyer companies will want to see the property and perhaps take pictures so they can come up with an accurate financial appraisal.
- Sellers usually get an offer that’s around market value within 24 hours. Remember, these have no obligations and the cash home buyer company will have the money on hand.
- A flexible closing is the last part of the deal. The timeframe is worked out at the seller’s convenience.
If you’re considering the Sell and Rent Back Option in Ontario, it’s critical to work with a credible company.
We Buy Houses for Cash
Mortgage Broker Store is a cash home buyer. We buy properties like condos, cottages, and homes for a price around market value. We offer the Sell and Rent Back Option discussed.
Speak With A Cash Buyer Right Now
With quick and friendly service, we are always happy to offer free advice. Whether you are serious about selling or just curious, we can explain your options and what to expect.
Remember, there are no commissions to pay and no upgrades or renovations when you use our services. Email ron@mortgagebrokerstore.com or call 416-499-2122 today.
