Safety In Dealing With A Property Rent Back Option

You might want to take advantage of one of the growing number of rent back schemes that are available to help people in these situations.

In a Rent back scheme, a company arranges to buy your house and gives you the opportunity to become a tenant. Instead of paying a mortgage, you pay rent. The rent charged is typically less than your mortgage payment.

You can also have the opportunity to buy back your house, when your financial situation improves. This is especially useful if you have suffered a temporary setback, such as illness or loss of your job. Once you are back on your feet you can make arrangements to buy your house again.

As can be guessed though, this service comes at a price. These specialist companies will typically pay a discounted price in return for the rent back service. The price they pay varies dependent on your property type, location, etc. Usually, you can expect to get an offer of about 10% - 20% below the market value of your property.

The beauty of a rent back scheme is that it can be designed to last as long as you want it to. If you decide that you only want to stay in your house for a short period, then you can. This will give you the valuable breathing space that you need to be able to find another property that you can move to. On the other hand, if you want to stay renting the property for the rest of your life, then you can do that too.

Care need to be taken not to confuse these buy house rent back schemes with the traditional 'Equity Release' approach. The main difference between them is that rent back schemes offer a lot higher price to purchase your property but the length of your tenancy can not be guaranteed. Most companies offering the rent back scheme intend to be in business for the long term. However, if your landlord's personal circumstances change you might find yourself being asked to leave the property so your landlord can sell it if he needs to.