Hi all,
Hoping for some feedback in regards to the equity from a house purchased under a rent to own scheme.
Question is who gets the equity in the house that has been sold on a rent to own property?
I assume it would be the buyers, so if that is correct how would they then prove/provide that information to a bank when they try/do refinance out?
Yes future capital growth / equity is to the benefit of the purchased and not the Vendor (of course unless the Contract states otherwise and I have done the odd shared equity deal under vendor finance).
The incoming Bank will normally only lend against the initial purchase contract irrespective of the value unless of course where the Contract if over 12 months old and then you may find the off lender advance against valuation rather than purchase price.
Richard Taylor | Australia's leading private lender
Thanks Richard,
You reply has helped a lot!!
Just one more thought, on a "shared equity" as you've mentioned, you say this is done in the initial contracts? Im guessing a good solicitor would be needed to put that in there? Further, I'm in Sydney, can anyone reckomend a good solicitor that can do rent to own deals???
http://www.businesslawyers.com.au for a good sol specilaising in this.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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