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Click here to fill out our short online application FIRST and find out if you qualify! There is nothing to lose, and by applying today you’ll quickly find out how we can help you.
If you prefer to learn all the details before you apply, read on!
What is Rent to Own?
Rent to Own is renting with the option to buy. It’s as simple as that.
How is it different then renting?
With our Homeowner Prep Program you will have an interest in the property in the form of an Option to Purchase Agreement, as well as the Option Deposit and Monthly Credits that will form your down payment when you purchase the home.
Who is Rent to Own for?
Rent to Own is for people who are unable to qualify for a traditional mortgage to purchase a home. Some reasons could be low down payment, poor credit or self-employment. It is also for people who cannot refinance their current homes.
How does your Rent to Own program work?
There are 3 Steps in Our Homeowner Prep Program:
- Step 1: Apply to Qualify
- Step 2: Choose Your Home
- Step 3: Prepare to Own
Why does your Rent to Own program work?
We have developed a Rent to Own qualification program that follows guidelines refined over several years. We ensure that each Homeowner Prep Program is the best option for each client and have the most effective strategies to help you fix your credit, build equity quickly and qualify for a mortgage within a few years.
What are the advantages of Rent to Own?
Our clients enjoy the benefits of home ownership starting today as they work towards officially becoming a homeowner. With our Homeowner Prep Program clients can:
- Move Into the Home Now: Instead of waiting until you can qualify for a mortgage, you get to move into your home now and qualify with the bank later.
- Test Drive the Home: Because you don’t officially own the home during the lease, you get to test drive the home to make sure that it’s just right for you.
- Use a Lower Down Payment: Our requirements are lower than the banks, so you can get started with less down payment.
- Build Equity: Monthly credits will help build your future down payment and put you in a strong position for home ownership. Plus, any improvements that you make on your home will increase the value above and beyond your final price. This increase in the home’s value is yours to keep because your purchase price is locked in. Finally, you will benefit from any price appreciation of the home above and beyond your purchase price.
- Improve Credit Score: During the rent to own portion of this program, we will work with you to improve your credit score so that you can obtain traditional financing when you exercise your purchase option.
I have bad credit, will I be able to qualify?
We specialize in working with people who have “bruised credit.” Our main objective is to assess whether your financial circumstances can be repaired and that you qualify for a conventional mortgage when you are ready to purchase. We structure each Homeowner Prep Program to give you enough time to build the credit and equity you need to finance your home at the end of the term.
Will you help me fix my credit so I can get a mortgage at the end of the term?
We will assign a credit counselor or mortgage broker who will guide you throughout the rent-to-own term. They will ensure that you are on the right track in repairing your credit and building the equity you need so that they can match you up with a lender down the road.
Can the application process be done over the phone?
Yes, we are able to do all of the work through the internet, phone, and fax which allows us to work all across Canada.
How soon will I know if I qualify?
You will know if you are approved for the Homeowner Prep Program (HPP) within 24 business hours of submitting a complete application.
Will we know what we are Pre-Qualified for?
Yes, once you are approved you will be given a pre-approval amount for the price of home you can choose.
Are the monthly payments higher than rent?
Yes, the monthly payments are higher. This is to ensure you can carry the financing cost of the home today, but more importantly in the future when you purchase the home. This helps prepare you to be able to carry a mortgage at the end of the term if interest rates go up at that time.
More importantly, the a portion of your monthly payment is treated as an option credit which helps you build the equity you need to finance your home at the end of your rent to own term.
Will my monthly option credits change throughout the Rent to Own term?
No, the monthly option credits are fixed throughout the duration of the program.
Who chooses the Rent to Own homes?
Once you are qualified for our Homeowner Prep Program, you can work with one of our real estate professionals to find the home you want on MLS. The Realtor must be Ownership Solutions Certified.
Do I need a real estate agent?
No, we will provide an Ownership Solutions Certified Realtor in your area that you can work with. These agents understand our program and will help you choose the right home to call your own.
Is there any criteria for the types of house we should be looking for?
Yes, you should be looking to find a nice family home, in a good/safe area. Metropolitan is preferred, and homes in good condition with little to no work required are ideal.
Can I Rent to Own a fixer-upper?
We deal with fixer-uppers on a case by case scenario. Many clients have valuable construction experience which can allow them to build considerable sweat equity in the property. All work must be preceeded by written notice and Ownership Solutions approval. All work must also be preceeded by all required building permits.
When we choose a home is it just about price and value of the home?
No. We do our best to ensure our clients can succeed in their dream of home ownership so the right home depends mostly on what you qualify for.
Does Ownership Solutions have to approve the house that we want to Rent to Own?
Yes and no. We are not picky, but we do need to make sure the home serves the best interest for yourself and for the investors purchasing the home on your behalf.
Who will own the house while I Rent to Own?
During your Homeowner Prep Program, one of our investors will purchase your Rent to Own home while you repair your credit, grow your down payment and prepare to become a homeowner.
Do I need a down payment? If so, how much?
Yes, for every Rent to Own we must have a down payment (option deposit). We require a minimum of $10,000 and the exact amount depends on the purchase price of the home you are interested in.
How much down payment will I have at the end of the Rent to Own term?
We structure our Homeowner Prep Program so that our clients will have built up at least a 7% down payment so that they can qualify for a 95% Loan-to-Value CMHC mortgage. This 7% will provide your 5% down plus 2% for your closing costs at the end of the Rent to Own program. Your initial option deposit and monthly option credits will form this 7% down payment.
Why is my down payment called an Option Deposit?
The Rent to Own program consists of an Occupancy Agreement and an Option to Purchase Agreement. Your down payment is your Option Deposit and will be credited towards the purchase of the home at the end of the Rent-to-Own term along with any monthly option credits.
How do you choose the price at the end of the term?
We use an appreciation value based on historic market values in the area to calculate the Option Purchase Price (your home’s price at the end of the term). We make to use a conservative estimate which makes it easier for you to obtain financing at the end of your term.
What is the minimum Rent to Own term?
The Rent to Own term can be from one to five years depending on how long is required to build your credit and equity to position you for home ownership.
What kind of agreements do you have in place to protect me?
We use an Occupancy Agreement and Option Agreement that have been drafted by real estate specific legal professionals and have been modified over the years in order to protect your option deposit, monthly option credits and right to purchase the home.
What is an Option Agreement?
The Option Agreement is a document that outlines your exclusive option to purchase the home you choose to Rent to Own. The agreement will include details on your initial option deposit, monthly option credits and future purchase price.
What is an Occupancy Agreement?
The Occupancy Agreement is like lease where it states the responsibilities of the occupant and the owner. It will include the length of the term, the monthly payment as well as the details regarding use and maintenance of the home.
Do we need a lawyer?
The agreements have been drafted by real estate specific legal professionals and have been modified over years in order to protect your option deposit, monthly option credits and rights to purchase the home.
However, we do recommend that you have your own lawyer take a look at all agreements. Your lawyer does not need to create new documents.
Who pays for maintenance?
As a participant in our Homeowner Prep Program, you will be responsible for any repairs and maintenance of the property as any other homeowner would. This helps you develop the homeowner mindset and learn about the care required as a homeowner. The advantage is that you will benefit from any improvements that may increase the value of the home once you exercise your option to purchase.
Who pays for utilities?
You will be responsible for paying all utilities which can include electricity, gas, cable TV, internet service, etc.
Who pays the taxes on the home?
The investor who will be holding title to the home until you are ready to purchase will be responsible for paying the taxes on the home.
Who pays the insurance on the home?
The investor who will be holding title to the home until you are ready to purchase will be responsible for paying the insurance on the home.
Will I need tenant insurance?
You will need contents/tenant insurance which covers certain items inside your home such as carpets, appliances, personal belongings, etc.
What if I decide not to exercise my option to purchase?
In extreme cases, if you decide not to exercise your option to purchase you will forefeit your option deposit and monthly option credits which can add up to thousands of dollars. We do not recommend this.
What happens if I cannot buy the home?
At Ownership Solutions we work hard to ensure you are a perfect match for our Rent to Own program. There are a few options should you be unable to qualify for a mortgage by the end of the program. If you require more time to repair your finances we can extend the Rent to Own until you are able to do so.
What happens if Ownership Solutions goes out of business during the initial term? Do we lose the house?
If Ownership Solutions were to go out of business during the Rent to Own Term it would have no effect on your Rent to Own transaction. The Ownership Solutions position is to act as a broker between you and the Investor. Once you qualify and find a home, we find an investor to purchase the home on your behalf. From that point on all of the agreements are between you and the Investor (Occupancy Agreement and Option Agreement as seen above).
I currently have a home and I cannot refinance or renew the mortgage, how can you help me?
If you are currently a home owner and are having trouble refinancing or renewing your mortgage, contact us immediately. We will analyze your financial circumstances and look at a number of options to find the one that best meets your needs.
I am Self-Employed, what does Ownership Solutions require for the income question on the application?
If you are self-employed, you need to look at Line 150 on your T1 General or your Notice of Assesments averaged for the last two tax years. This is the taxable income that Ownership Solutions will take into consideration when processing your application, but we do take your self-employed status into consideration when evaluating your income level.
What are some reasons for not being able to qualify for Rent to Own?
- Not enough down payment
- Income for area you are looking does not support the monthly costs
- The house prices you desire are out of your Rent to Own range
- Inability to meet deadlines
Ready to apply? Click here to fill out our short online application and you’ll quickly find out how we can help you.