First Rent to Own- Need help

[Cassidy Burns]

Hi BP,

I have a current inquiry of someone wanting to rent to own 2 different pieces of property that I own. I do not have any current experience with rent to own so any advice is appreciated.

The numbers:

Property #1: Parcel of Land (.25acres) Neighbor wants to purchase this.

I offered it to him for $3,000, he has agreed to the price but needs to do a payment plan over 2-3 years. How do I go about setting that up? $100/month in rent. $50 is put towards his purchase price? Also how do you handle the initial deposit? Once he has enough cash to purchase does he purchase through the bank?

Property #2: Single Family Home.

Purchased for $35,500

Renovation costs: $12,000

Sales Price : $72,000

Two different individuals have reached out about rent to own on this property. My initial plan was the following. Refinance, pull all of my money out, get a loan for $50,000. Appraised value will be $75,000+. Rent $700/month. $650 rent, $50 saved for home purchase. 3 year term. Again what do you charge for initial deposit? Do you still collect security deposit?

Thanks BP!