Rent to Own FAQ's

Rent to own is a strategy that helps people get into homeownership by first renting the home and then after 2-4 years, purchasing the home. Throughout the 2-4 year period, rent is paid plus an additional option consideration which goes toward the down payment for the home. Rent to own provides an opportunity for people who are unable to obtain traditional financing through the bank. It allows them to live in the home they want to purchase now (through renting), and taking ownership of the home at a pre-determined future date and at a pre-determined future price.

Rent to own is a strategy that helps people that are unable to obtain traditional financing, get into homeownership. The tenant-buyer (who will become the homeowner) and the rent to own provider will enter into an agreement whereby the tenant-buyer has an option to purchase the home at a predetermined future date for a predetermined future price. The tenant buyer will move into the home while paying rent plus an additional option consideration which goes toward their down payment accumulation. During the rental period (typically 2-4 years), the tenant-buyer works through steps outlined by the rent to own provider to address the barriers they had to obtaining a mortgage initially (ie. credit issues or insufficient down payment). At Hello Homeowner, this plan is customized to your unique situation. At the end of the term, the tenant buyer can exercise the option to purchase the home from the rent to own provider at the agreed upon purchase price. The tenant buyer becomes the homeowner and has completed the rent to own program!

Rent to own can be tenant first or property first. A rent to own program that uses tenant first approach will find a qualified tenant-buyer first. They will then have the tenant-buyer work with a realtor to find the property they want to purchase. Alternatively, a rent to own program that uses a property first approach will first find a property to purchase, and then find a tenant-buyer to place into the property. We at Hello Homeowner follow the tenant first approach. We believe that finding a qualified tenant-buyer and providing them the opportunity to select the home of their choice provides a much higher chance of a successful outcome as there is emotional attachment to their selected home. We want you to love your home and nurture it the moment you move in.

We are currently accepting applications for most markets in Ontario with a population of at least 10,000. We have plans to expand nationally and will consider applications from markets outside of the abovementioned on a case by case basis.

In order to qualify for our rent to own program you must satisfy at minimum 2 requirements: Minimum down payment of 4% of the purchase price Minimum annual household income equal to 20-25% of the purchase price of the home (include all applicants income) Even if you don't meet these minimum requirements currently, we encourage you to fill out our application. We can add you to our email list and send you tips and advice on how to work toward becoming a qualified rent to own applicant.

Our program is unique in a couple of ways: We don't charge any application or program fees! The only payments you make go directly toward your rent and down payment accumulation and property maintenance. We don't charge you any fees to process your application and no administration fees once accepted into the program. We offer continued support throughout the program. In addition to the customized plan that we prepare for you upon acceptance into the program, we continue to offer you support throughout your time with us. Have a question? Ask us any time. Want a referral to a contractor or repair man? No problem! Unexpected life event occur and need some advice? We are here to help! Your success in the program is our utmost priority so transparency is essential and we will work through your unique circumstances with you.

Your customized plan will include the following: Monthly payments made toward rent and down payment accumulation Estimated utility payments Estimated discretionary income Actionable steps to repair or build credit (as applicable) Schedule of property inspections (typically bi-annually) Schedule of financial reviews (typically bi-annually)

The tenant first approach to rent to own simply means that we first find a qualified tenant buyer (you!) and then send the tenant buyer off with a realtor to find the property of their choice. This is alternative to property first where a property is found first and then a tenant buyer is placed into the property. We employ the tenant first approach because we recognize that house hunting and choosing your own home is a huge part of the process. We want you to be excited about your home. We want you to envision your family in the home. Envision the renovations you might do to the home. And importantly, to fall in love with the home. Our research shows that there is a significantly higher success rate with the tenant first approach and that is why we use it.

It can! We look at many different factors when qualifying a tenant buyer applicant and credit is just one of these factors. With that said, we do work with people that have poor or no credit. Understanding the issues with your credit and how the issues came about will allow us to provide you with the information and tools required to repair (or build) your credit. This is a huge part of our program and what will allow you to become successful in the program!

Yes! Although you may have heard that it's difficult to get a mortgage as a self-employed person (or maybe you have already been declined by the bank), through our rent to own program we can help you set yourself up to become mortgageable through our program. We have the knowledge to understand what the banks look for from self-employed persons and will provide you with guidance to get you where you need to be, all the while living in your home.

As part of your plan, we will outline the payments you are required to make monthly. A portion of your monthly payment will include an option consideration which will be applied directly to your down payment at the end of the term. It is this option consideration portion that you pay monthly that will help you to build up you down payment. This amount remains constant throughout your term and is calculated prior to moving into your home so there are no surprises.

Once you move into the home, you will be responsible for payment of all utility accounts. Throughout the program term, we at Hello Homeowner will take care of property tax and home insurance. Once you successfully complete the program and take ownership of the home, you will then start making the property tax payments and will be required to obtain and pay for your own home insurance. While in the program, it is required that you obtain content insurance. This insurance covers your personal belongings in the home in the event that you incur a loss. It is the same type of insurance that many landlords require their tenants to hold. This insurance usually costs around $25-45/month.

As a future homeowner, you will be responsible for snow removal and yard maintenance.

Absolutely! Pets are family. You are allowed to have your pets as long as it complies with the local by-laws.

Yes you can! Unlike renting, rent to own allows you to add your personal touches to the home. You can paint, hang wall art and even complete more extensive renovations throughout your term. We simply ask that you consult with us for any extensive renovations first to make sure it won't negatively impact the value of the home or your ability to obtain a mortgage at the end of the term.

Your monthly payment will be determined at the onset of the program. Everyone's monthly payment will differ depending on the amount of down payment you bring with you, the cost of the home that you are approved for and the length of the term. In Southwestern Ontario you are likely to be making payments between $2500-3500/monthly plus utilities.

The purchase price of the home is determined by adding a conservative 5% compounded appreciation for each 1 year in the term. For example: If the property is purchased for $500,000 and you have a 3 year term, the future purchase price would be $578,812.

We want you to be successful. We complete a thorough analysis at the onset of your entry into the program and ensure that the monthly payments won't make you house poor. With that said, if you have an issue making a payment, please let us know ASAP. We will work with you to come up with a plan to ensure you can continue in the program and prevent further missed payments from occurring to the best of our ability.

We do a thorough analysis of your income, expenses and credit report before accepting you into the program. From this analysis we put together a tailored step by step plan, and support you along the way to ensure a successful outcome. We only accept people into the program that we feel confident will be able to complete the steps and actions required to be able to obtain a mortgage at the end of the term. With that said, unexpected things occur and whether it's something personally or in the market that has resulted in being unable to obtain a mortgage, we have a few options that we would be happy to discuss on an individual basis should this situation occur.

Yes! The theme you will see throughout our website is we focus on the tenant buyer first. We want you to succeed and be happy in your home. Once approved, you will start your house hunting with a realtor and choose your own home. We will need to approve the home and have a home inspection completed on your selected home before moving forward.

If you have a realtor that you would like to work with, you absolutely can! We also have relationships with local realtors and can refer you to one if you don't have one of your own.

We do accept multiple applicants/co-signors. However, it is important that any co-signors plan to continue to be a co-signor at the end of the term when it's time for you to qualify for a mortgage. Typically the best co-signors are a spouse. Parents, children and more distant relatives may not be in a position to want to co-sign at the end of the term.