I always fear I’m rehashing something that’s been discussed before, but I couldn’t find anything with a keyword search, so here goes.I’d like to get a handle on pricing for the various programs for the homes themselves. I realize that rent-to-own is no longer a good idea due to SAFE/DF, but I’d like to understand how one would price rent-credit program today compared to how they would have priced rent-to-own in the past. I’m actually considering converting a few from rent-to-own to rent-credit for CYA.Let’s say you’ve got two homes that you would sell for cash at $8K and $15K. For each home:* What would have been your rent-to-own terms in the past? (I’ve sometimes heard that terms price is twice cash price, but if so, over how many months?)* What would be your rent-credit terms today?Or if you’ve got examples with different prices, that’s cools too. Thanks as always, this forum is a goldmine :)HPD
RTO or RC, it makes no difference to your pricing. We take $2,000 down and sell most of our 3/2s for $600/month for ~60 months. We’ve added a line to F&D’s standard RC form that calls out that tenants are purchasing $2,000 rent credits up front. Same pricing, different legal contract.Hope this helps,-jl-
To supplement Jefferson, I think that you had better have the same price, cash or terms – this is one point of Dodd Frank that would make you suspect if you did otherwise.
Thanks, I’m interjecting as I am following posts related to " rent credits ". I own multiple parks ( approx. 150 pads) and in the beginning there were no “park owned homes” when I bought them. However, as we all know attrition happens and we wind up buying a lot of homes very reasonably. My direct question is, regarding your post, what happens at the end ? Do you gift the home if they have honored the rental agreement to the letter ?
Thanks.
GL