Your Real Estate Partner, Elbanita Properties
Poor Credit or No Credit
You deserve a chance, more so with owning a your own home. You can count on us to help you every step of the way to make that dream a reality for you. Having no credit, poor or bad credit should not stop you.
Self-Employed/New in Canada
We know that getting a mortgage can be tough for you as an immigrant. Or you, the hard-working people who deserve to own their homes but can't simply because they are self-employed. We can help with your goal of home ownership, whether you are self - employed or new to the country. Our team has the experience and expertise necessary to make the process as seamless as possible. All you need to do is to reach out if you have any questions.
If you have been through a divorce or bankruptcy, we can help you get back on your feet today. Even if the divorce or bankruptcy has negatively impacted your credit score. Be rest assured, we will provide all the help and guidance you need to succeed in owning your own home.
OUR RENT-TO-OWN PROCESS
Why rent when you can own your home? Bear it in mind, every cent you pay in rent pays down somebody else's mortgage. That’s why we have designed our special rent-to-own program so that each cent you pay goes towards your own home. Our customized program provides creative options to help you realize your dream of home ownership, irrespective of your home ownership challenges.
The beauty of our program is that you as tenant-buyer have the opportunity to work with your own real estate agent to choose your own home, like you would ordinarily do with any other house buying exercise. Our program assists you to enjoy that experience of shopping for the home of your choice.
To access our program all that you need to do is to be pre-qualified to see if we make a fit for each other. This screening can be done online or we can send out a pre-qualification information sheet to you. Once you are qualified, you will be advised the plan choices available and you are then ready to go on your house hunting with a real estate agent. We have experienced real estate agents that we work with who are very capable to help you find the house that matches your dreams. You also have the choice of working with your own agent, if you have one. To set you up for the house hunting, you will need to show a commitment by paying a small deposit.
Once the house is found, a home inspection and an appraisal would be conducted using certified professionals. After closing on the acquisition, the tenant-buyer signs all necessary paper work with our lawyers. Tenant-buyer is then ready to move into home.
Basically, the program has two component parts: the potential tenant-buyer rents the house and makes regular payments in the same way you would rent any other apartment or house. Each rental home comes with a lease agreement and the tenant is expected to adhere to the lease agreement to keep the lease and remain in the Rent-to-Own program. The tenant-buyer is also signed up for an Option-to-Buy agreement. This is what differentiates the program from an ordinary rental situation. The Option-to-Buy agreement allows you to buy the home for an agreed upon price at any time during the lease term. Note that this is merely an option to buy which means that you are not obligated to buy when the lease ends. Thus, it gives the tenant-buyer the right, but not the obligation to buy a property.
For the privilege of having the option to purchase the house, tenant-buyer requires to make a small payment, 2-5% of the market price of the property upfront. This is called Option Money.
It guarantees the Rent- to-Own contract and commits the tenant-buyer to work towards correcting the challenge that has hindered the dream of home ownership so as to achieve a successful outcome. The option money is applied to the final purchase price or the down payment for the purchase of the house.
It is possible, depending on the plan option you choose, that a portion of the monthly rent, every time the rent is paid on time, can be credited to the Tenant-buyer. Where that is the case, rent payments may be divisible into two portions: one portion, which goes toward the rental fee. Second portion, which can vary between 10 - 20% of the monthly rent depending on your plan, goes to rent credit for the tenant-buyer. The rent credit will eventually go toward the final price or the down payment for purchase of the house.
At the end of the lease term, the tenant-buyer would have sufficiently repaired the issues that are the challenges to their home ownership so that they are now able to qualify for a regular mortgage. They also would have paid up enough towards the down payment that they are able to purchase the house.
A Typical Rent-to-Own Scenario
For the sake of clarity, let’s say that a Rent-to-Own agreement is for a 2-year term. Imagine a tenant-buyer who pays a total of $1,800 per month. Assuming $1,500 is the monthly rental fee, an additional $300 per month will be a rent credit (i.e. 16.7% of monthly payments). Also, assuming that the rental fee is 0.5% of final asking price for the house, it means:
· Final asking price for the home is locked in at – $300,000
· Upfront deposit is – $9,000 (3%)
· Money outstanding at start of lease term - $291,000 (that is, $300,000 -$9,000)
· Monthly rent - $1,500
· Monthly rent credit -$300 (that is, $1,800 - $1,500)
· Rent credit per year - $3,600 ($300 x 12), i.e., total - $7,200 (that is, $3,600 x 2 yrs)
· Final outstanding money at end of lease term - $283,800 (that is, $291,000 - $7,200)
Note that total credit for the tenant -buyer in this example is $16, 200($7,200 + $9,000). Only $283,800 remains to be paid on mortgage after the 2 years lease.
Keep in mind that although a grand total of $43,200 may be paid in rent over those 2 years. All of that rent does not go toward the final Sales Price. That means $43,200 was invested in monthly payments, but only $7,200 of rent credit actually goes towards the final buying price.
Why You Should Think Rent-To-Own Instead Of Renting
• Home Ownership Test Drive: You enjoy benefits of owning homeownership while you are test driving it to see if it suits your needs before you ever buy.
• Build Equity in Your Home: You are on course to own the home soon. Improvements you make on the property go to increase the value of the property and help you to build more equity in the house.
• No Lender: You don’t need to qualify with any lender now, it means that you can move in without a lender approval and begin to test drive home ownership.
• Rental Credit: Each month your rent is paid, a part of the rent could get credited to you. The credit goes toward your final purchase of the home. This allows you build equity in the home faster than in a traditional situation.
• Flexibility: You are not obligated to buy the property at the end of the lease term. You have just an option to buy.
• Your Credit: While you are renting to own, you are also creating a better credit. The program helps you work through any current credit related issues
Caution: If you decide against buying the property by the end of the lease term, any earned credit is non-refundable. Accumulated rent credit is considered to be rent paid.
How to Get Started
To get the process started, you would need to be pre-qualified to see if rent-to-own is a good option for you. You can be approved in 1-2 business days.