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Who Handles Repairs on a Rent to Own (RTO) Home?

by | Oct 8, 2021 | Rent to Own

Who Handles Repairs on a Rent to Own (RTO) Home?

When you rent to own a property, you’re essentially leasing the property, but with the intention of purchasing it once an agreed-upon amount of time has passed. This is often the least expensive way to buy a home because you don’t have to pay a hefty down payment or go through the financially rigorous process of obtaining a mortgage

So, you’ve done all of the leg work, and research, and found the perfect home. (And if you haven’t, you need to click here so you don’t miss out on finding the perfect rent to own home!)

But, for those of you about to enter into a month-to-month rent-to-own agreement. You’ve taken a tour of the property, had a walk-through, and you’ve signed the contract, and put down your deposit.

Then as soon as the paperwork is signed and filed and you start moving in, you notice some repairs that need to be done i.e. a leaky faucet, a broken door knob, or a torn screen. Who is going to repair any of these issues in the home? Is it you? Or is it the landlord?

Who Handles Rent to Own Repairs?

This is a common question asked by people who are looking to buy a home with a rent-to-own agreement. The answer can be a little complicated, but at the end of the day, it depends on the agreement. In some cases, you are responsible for repairs. In others, the seller is.

Generally, if you’re renting a property and want to buy it, your landlord will ask you to sign an agreement that says that you’re responsible for repairs on the property as part of your monthly rent payment. This is called an owner-occupied lease or an owner-occupied agreement. If this is the case in your agreement, then you’ll be responsible for all repairs at any time during the lease period. 

In other cases, if the seller isn’t living in the home anymore (for example, they are intending to sell it to you at the end of the lease agreement), they may agree to cover some or all of your repair costs during this period as well as after closing on the sale of their home so long as they’re not due to negligence or abuse by either party (in which case neither party would be responsible). 

Usually, the landlord will be responsible to maintain the property and pay for any repairs that accrue while under the lease agreement; it’s important to read the fine print before you sign in order to ensure this. Sellers are ultimately going to be the most responsible in these agreements due to HOA fees, taxes, insurance, and other costs while being the homeowner. 

This is why it is important to consider hiring a real estate attorney while signing a lease agreement and highlighting your responsibilities as the renter. You may have to maintain the property, like doing the yard work, cleaning out the gutters, and doing basic repairs. Of course, that is a stark difference from replacing a roof and bringing the property up to city code (electrical and foundation). Before you sign, you may also want to have the house inspected or appraised to make sure that you will not be responsible for updating the property while under contract. 

These are just a couple of reasons why it’s important to get the help you need when getting into your rent to own home. Click here so that The Renter’s Best Friend can help you get into your first rent to own home today.

No matter the terms of the contractual agreement, it is strongly recommended that you opt into a renter’s insurance policy to cover personal property losses and liability coverage if someone were to be injured while on the property or if you accidentally injure someone while in your home, just as you would with a homeowners insurance policy. 

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