Rent-to-own tenants are different from regular tenants. Usually, they’ve faced some kind of hardship that’s preventing their approval for a regular mortgage by banks and other lenders.
People looking into rent-to-own programs approach the situation in a number of different ways. They may have limited cash on hand. Perhaps they have bad credit or no credit at all. Most banks and lenders don’t grant mortgages to those with poor credit history. Rent-to-own programs are an attractive option because they help to build and repair credit.
1. Identifying Demographics
Many young people today are faced with the burden of loans or lines of credit. These can take years to pay off. The rising cost of living may also play a role. Whatever the cause may be, lack of money is a common problem and some people just can’t seem to save as much as they’d like. There is also a list of other factors that may be at play, such as a short employment history or recent entrance to Canada.
Without any substantial savings or credit history, a person may experience barriers to home ownership. Rent-to-own programs do not require as large of an up-front payment as a down payment would. The monthly payments are comparable to that of home ownership, allowing the tenant to get used to paying these amounts within their budget. The great benefit is that the tenant is able to live in the property that will soon become the home they own.
2. Reaching the market
As an investor, this is where you come in. Whatever adversity tenants have had to deal with, you can help them to overcome with a custom rent-to-own agreement.
So, how should you go about finding them? You can market to them through traditional classified ads, such as newspapers or niche listing publications. You could try advertising with online classifieds, buying signage in the area or using social media to reach your target demographic.
Unfortunately, all of these options take a lot of time, effort and resources to maintain. Identifying the right tenants is not a simple task.
3. Getting It Right
At Totem Strategic Investments, we know that a lot goes into finding the right tenants for your investment. Fortunately, we’re here to lend a helping hand.
As investors ourselves, we know that identifying quality tenants is of utmost importance. TotemSI and its partners have demonstrated necessary due diligence in identifying quality tenants for your investment. We’ve already done a lot of the work for you. We’ve spent time building relationships with pre-screened tenants that you can trust to take care of your property and make payments on time.
Our tenant relationships are evidence of our commitment to your success. We want to ensure that your experience is as smooth and efficient as possible. That means eliminating the messy DIY search and the potential pitfalls that go with it.
Of course, TotemSI respects the importance of personal research and making your own decisions. We can be as involved or uninvolved as you’d like. But we’re always here when you need us. Contact us today for more information about identifying rent-to-own tenants!