rent to own explained

The Property Step — Fri, 06 Jun 2008 10:55:29 +0000

The award winning financial website of the year, thisismoney.co.uk has reported that first-time buyers need a hefty 13% of the purchase price since the mass withdrawal of 95% and 100% mortgages.

With a typical entry-level property in London costing around £250,000, this would mean having to find £32,500 – in addition to stamp duty, legal fees and removal costs.

Compare this to the average London property – now more than £350,000 – the deposit would be £45,500, plus £10,500 in stamp duty. No wonder 100% mortgages have existed for so long!

If you thought finding the deposit was difficult, then you have to contend with having a financial track record: Credit reference, credit history and absolutely no late payments on anything.

Having jumped through the multitude of hoops you’ll then get that all important decision in principle. Talk about headaches it’s enough to make you reach for the Anadin Extra.

The Property Step can ease those headaches with a no nonsense Rent to Own scheme. It’s a win/win property solution that helps first time buyers get on the property ladder safely. To see how this works, take a look at Mr & Mrs Rhodes, a fictional young couple starting out.

Mr Rhodes works as a builder and Mrs Rhodes as a telesales executive, together they earn above the UK average and can afford an 80 – 85% mortgage.

However all the major lenders will not approve their mortgage, as neither have owned a property in the UK, do not have a recent credit history and cannot afford the exorbitant deposit. With the influx of overseas workers in the UK this is a known hurdle.

In some cases it can take up to two years to obtain a credit history to satisfy the main mortgage lenders and even longer to find the deposit. In the meantime property prices have risen making it even more difficult to save for that ever increasing deposit.

Typical Scenario : Mr & Mrs Rhodes

Mr & Mrs Rhodes have some savings towards their deposit but not the 13% plus costs. They can afford to pay a 85 -90% mortgage but are caught in the first time buyers, mortgage trap without a recent credit history and large deposit. With property prices fluctuating over the years they are no closer to buying their first home.

Property Solution: Rent to Own

The Property Step offers Rent to Own properties. To secure your new home the purchaser/tenant must agree to:

A fixed purchase price, with an option to buy in 2 years or less.
Pay a one off (non refundable) deposit, deductible from the fixed purchase price.
Where applicable overpay rent during the 2 year period acting as credits deductible from the fixed purchase price.
Pay rent on or before the due date (typically 1st of the month), to qualify for the deduction on the fixed purchase price.
Repair and maintain the property as needed during the duration of the rental period.
Exercise your right to buy at the fixed purchase price or vacate the premises at the end of the 2 year period.

Rent to Own Benefits are numerous:

An agreed fixed purchase price, set in stone with no fluctuations, no gazumping, no nonsense.
Pay an affordable rent that reduces the final purchase payment, aiding the deposit required by major lenders.
Obtain a certain credit history that satisfies all mortgage lenders. Note: By proving your able to rent and pay on schedule and on time, gives major lenders confidence that you are a good reliable payer.
Live in your house from day 1, so there is no need to move to another area.
No trawling of the many property websites and pounding the streets viewing unsuitable properties.
Your safe in the knowledge that you’ve already found your home and build for the future.
Gain equity in your home before you own the property. As property prices adjust you will directly benefit from fixing your purchase price today.

To join our waiting list of customers for Rent to Own properties please click ‘Rent to Own Required‘ to register your interest. We will contact you as soon as we have a property available.

Credit Crunch stifles first time buyers

The Property Step — Wed, 04 Jun 2008 10:25:13 +0000

It is now clear that the fallout of the credit crunch is spreading from housing to the rest of the economy. The Property Step has found an increasing number of sellers are unable to move onto the next step as no-one will buy their home.

If that was not enough doom and gloom, one of the UK largest retailers Marks & Spencer seems to confirm our fears. Chief executive Sir Stuart Rose says there is no end in sight to the slump in spending. ‘Consumers are feeling the pinch’.

If your wanting to move due to financial commitments, a growing family, emigrating, divorce, increasing debt, buy-to-let gone wrong, repossession etc then the credit crunch is effecting you.

Report after report, states that we are in for a hard ride and those who stretched themselves during the so called boom will have to seek out alternatives to manage their homes.

More and more over stretched homeowners are being repossessed according to figures from The Land Registry. These are uncomfortable moments for those with high mortgage payments, large monthly credit card bills and a family to support. Is this the game of chance you want to take? Is this a game at all?

If this sounds familiar then your not alone, ask the average man or woman in the street are they feeling the pinch and chances are they’ll respond with a positive yes!

The Property Step provides property solutions to array of homeowners in various circumstances. Our method is simple we buy property for cash, then you can move onto the next step.

Without first time buyers everyone suffers, as they are the beginnings of a property chain. The Property Step has been able to help numerous homeowners by making a cash offer for their home. Every home-owners’ circumstances are different however the need to sell remains the same.

If 2008/2009 predictions are correct then selling your property for a cash price offer may be wisest move you’ll make. Bite back and kick the credit crunch into touch with The Property Step , buyers of property for cash.

The Property Step » first time buyers

rent to own explained

Credit Crunch stifles first time buyers