Rent To Buy gets the Self Employed onto the Property Ladder

If you have started a successful business and making money for yourself, your house dreams could be shattered because you can’t get a mortgage and you could end up paying dead rent. In this article, I’ll explain how Rent To Buy (also known as Rent To Own or Rent 2 Buy) schemes can help you achieve your house dream and get you onto the property ladder in the UK. I’ll show a clear path to owning your own home. You’ll see how you don’t need a mortgage and if you don’t need a mortgage you don’t need three years’ books or payslips. We’ll also look at some of the benefit of being a tenant buyer.

In the current financial climate banks don't want to lend and that has just about killed the property market. If you are Self-Employed or just starting out in your business, the banks will regard you as a high risk and you’ll be penalised with a large deposit and high interest rate. They’ll also impose stiff arrangement fee that can really add up. Rent to Buy schemes don’t need a mortgage initially because the first part of the scheme is a standard AST tenancy agreement that gets you into the house. The second part is an Option to buy the house (a Purchase Option). The purchase price is agreed up front and will be around the current market price. This price is fixed until you buy the house. You will need a small deposit of around 5%-10% and this will be the Option Consideration.

So, you get started in owning your own house as a tenant with a purchase Option. The Option Period will be anything up to 10 years and, at any time in that period, you have the legal right to buy the house at the agreed price. You can agree an Option Period that suits your business goals. After a few years, you will have the books and evidence you need to obtain a mortgage in the normal way. You started the Rent To Buy scheme as a tenant and end up as a buyer; hence the term Tenant Buyer.

As a tenant buyer, you have many benefits under the Rent to Buy scheme. I mentioned previously that the Purchase Price is fixed at the start of the Option agreement. This means that if house prices go up, you will benefit from the increase. If you make any investment in the house like an extensions or improvement, you will keep all the gains.  Remember also, you have an option to buy but not an obligation so it’s your decision that you can exercise any time during the option period. If house prices go down you may not want to buy the house and can simply walk away.

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To get on the property ladder as soon as possible, get on our mailing list for the latest Rent To Buy properties in the UK. Get into your own house while the house prices are near the bottom of the market and start benefitting when house prices go back up. Get-On-The-Property-Ladder.co.uk are Rent To Buy & Rent To Own specialists and work with many of the best UK property sourcing companies to bring you some of the cheapest property available.