Hi resident RTO experts,
I have a question that I am hoping you can lend your expertise to. I have a rather unique situation where my long-term tenant (4 years and counting) would like to purchase our home. We’ve had preliminary discussions on the subject and it appears that the concept of RTO is of interest to them. I should stress that this is not a conventional RTO situation. They have agreed to the price but need a ‘bit’ more time to organize the financing - we are unsure how long this means but I suspect somewhere between 6 months to a year. What makes this circumstance unique is that fact that they have a large option deposit they are prepared to make ($35,000) but have asked us if we would consider applying a portion of the rent they are currently paying (which is slightly higher than the market anyway) towards their deposit if they purchase. My wife and I are very fond of this family and would like to help them purchase our home (yes it’s time to say good-bye) and feel that we are in a position to offer them this but we are unsure as to how much is fair. They have also asked us if they could undertake some renovations on the home during the time they are waiting for their finances to be sorted. This suggests to us that they are serious about moving forward with the purchase at some point. Nevertheless, it does make us a little uneasy.
Our initial position is that we will offer them a 12 month period to organize their finances to conclude the purchase. If they purchase the home, then the $35000 which is held in trust will be refunded or applied to the purchase) once the sale of the home is complete along with the rental portion we’ve calculated. If they don’t go ahead with the Lease Option then we will keep the $35,000 and the rental portion is not applied or refunded. As far as the renovations are concerned, we haven’t said yes or no, but our feeling is that as long as it’s an improvement to the property then yes, we will approve it but it’s at their cost.
I would appreciate any feedback you have and more importantly any flaws with our thinking you see.
I have a question that I am hoping you can lend your expertise to. I have a rather unique situation where my long-term tenant (4 years and counting) would like to purchase our home. We’ve had preliminary discussions on the subject and it appears that the concept of RTO is of interest to them. I should stress that this is not a conventional RTO situation. They have agreed to the price but need a ‘bit’ more time to organize the financing - we are unsure how long this means but I suspect somewhere between 6 months to a year. What makes this circumstance unique is that fact that they have a large option deposit they are prepared to make ($35,000) but have asked us if we would consider applying a portion of the rent they are currently paying (which is slightly higher than the market anyway) towards their deposit if they purchase. My wife and I are very fond of this family and would like to help them purchase our home (yes it’s time to say good-bye) and feel that we are in a position to offer them this but we are unsure as to how much is fair. They have also asked us if they could undertake some renovations on the home during the time they are waiting for their finances to be sorted. This suggests to us that they are serious about moving forward with the purchase at some point. Nevertheless, it does make us a little uneasy.
Our initial position is that we will offer them a 12 month period to organize their finances to conclude the purchase. If they purchase the home, then the $35000 which is held in trust will be refunded or applied to the purchase) once the sale of the home is complete along with the rental portion we’ve calculated. If they don’t go ahead with the Lease Option then we will keep the $35,000 and the rental portion is not applied or refunded. As far as the renovations are concerned, we haven’t said yes or no, but our feeling is that as long as it’s an improvement to the property then yes, we will approve it but it’s at their cost.
I would appreciate any feedback you have and more importantly any flaws with our thinking you see.