It won’t be long before the whole of the UK gets on board with using “Rent to Buy” as a prime way to buy property, because of the massive benefits for the incoming home owner.  Based on  my own experience of working with home buyers, here’s a list of the Top 10 Benefits… not in any particular order, so you can decide for yourself.

You only need 3-5% “get started” money.

I have lost count of the number of first-time home buyers who tell me they feel like they’re moving further away from their dream, because of the deposit demands of the high street banks.  True to say, you’ll need anything up to a 25% deposit to get the best mortgage rates right now, and saving THAT much money in a recession is a really tough ask.  A typical Rent to Buy scheme only asks the tenant-buyer for a far more affordable 3-5% of the home’s value to get started, giving a significant advantage over traditional loan terms, and offering a much more achievable target for getting on the property ladder.

You don’t need a mortgage today.

That’s right… a typical Rent to Buy scenario lets you move into the home straight away, without all the delays and hassles of getting a mortgage from the outset.  This is normally because the home has been purchased with private funding, or sometimes leaving the asset of the  previous owners debt in place for the period of the option term. This time lag allows the incoming tenant-buyer the luxury of applying for finance at a time most suitable for them (for example; when a great mortgage product is being promoted, or when their savings are at an optimum level).

You can build up a payment history as you go along.

There is a little understood barrier, particularly amongst first-time home buyers, around the issue of their credit rating.  To have the BEST credit score (and therefore be an appealingly low risk for the banks AND get their best loan interest rates) you actually need to have a history of borrowing and successfully paying back money. By taking a Rent to Buy option, a track record of paying monthly outgoings such as utility bills, council tax, rent and option fees builds up, increasing the chances of a successful finance application when the right time arrives.

Special Note: By joining my special “Insiders” list you’ll have at least 48 hours advance notice of every new property, as it becomes available. That’s 48 hours to get in touch with me, and grab your new home before I advertise it on the internet, in the press, by leaflet drop or notice boards. Just place your first name and primary email address in the form (it’s in the sidebar to the right), then hit the “Register me now” button, and you’re an “Insider” from this moment on.

You can start buying while your credit rating repairs itself.

So… you’ve been a bit unlucky in the past, and maybe missed a couple of regular payments that has spoiled your credit rating for a while. Should that mean that you’re denied the opportunity of home ownership?  With a Rent to Own property the answer is firmly NO. Of course, you would expect to discuss these matters with any potential landlord or seller, but if you can satisfy some basic criteria and demonstrate steady employment, earnings potential, and a commitment to clear the slate of those old misdoings, there is no reason why you can’t be a home owner and start the buying process straight away.

You can avoid sales “chains”.

Home buying can be unbelievably frustrating at the best of times. But if you’re trying to set up home and your purchase is dependant on a whole chain of sales activities, all completely outside of your direct control, things can quickly get out of hand. With a Rent to Buy transaction there is no “chain” effect to worry about. The property will have been purchased / financed as an individual transaction, will be vacant and available immediately, and with no other obstacles standing in your way you can move straight in.

You can avoid the “dead rent” trap.

Paying out rent every month is a drag on your finances, and slows down the rate at which you can save towards that dream pad you so richly deserve. With a Rent to Buy option, you still have a rent element to your monthly outgoings… but part of your contribution is effectively a “forced” savings plan that builds into a useful lump-sum. ALL of this extra element comes directly off the sale price, meaning that the point at which you can afford to buy the property outright is always moving towards you – not getting further and further away. You could expect around 20% of the total monthly payment to count towards this savings scheme in a typical Rent to Buy agreement.

You know the price is agreed in advance.

Property prices can be volatile, and another benefit of a good Rent to Buy scheme is that the sale price is agreed in advance. This certainty is a really useful target for the tenant / buyer who knows how much to budget for additional deposits and costs, and exactly how much will need to be raised on finance to complete the purchase.

You can add value to the property and keep the profit.

This IS home ownership, and if you’re a bit of a DIY enthusiast you can turn your hand to some home improvements during the Rent to Buy option period. Because the purchase price is fixed, as mentioned above, any increase in value will result in extra profit for you, or potentially a lower loan to value ratio when the property is valued for loan purposes. Be careful though… most landlords and sellers won’t want you to undertake major structural alterations without full consultation, and be aware that some changes need planning permission before you start.

You can choose the best time to buy.

All Rent to Buy agreements include a fixed term, called the Option Period, because you have the OPTION to buy the property at the agreed price at any time within that allotment of time. So if you happen to make a bumper bonus at work, come in to some inheritance, win the lottery, or just find an excellent mortgage deal that suits your circumstances, YOU choose the time to purchase.  Caution: Once the Option Period expires, be prepared to either re-negotiate (most owners are open to that, if its cash flow positive for them) or walk away.

You win bragging rights with all your mates.

Using a Rent to Buy scheme can get you into a property that would otherwise be unavailable to you, as you can see from the list of benefits above. Just imagine hosting all your friends and family to that party or BBQ in your new home!  They’ll all wonder how you did it… but your secrets safe with me!

And finally…

Now… it’s time to make your move. There’s a lot more information on Rent to Buy that you can find by using the links in this article. You can join in to complete our Poll of Home Buyers, and get on to the special “Insiders” list that sees properties before they’re advertised anywhere else. Together we’ll start the journey to find your Dream Pad… Just imagine how you’ll feel when you’re the king (or queen!) of your own castle.

Many people today cherish the dream of owning a house, whether just for themselves or for their family. It really makes a big difference when you are living in a house that you truly own, rather than just shacking up in a place that you cannot call your own.

Certainly, buying a house has not always been easy because of its complex procedures, especially in terms of the financial considerations, so it is natural that some people have reservations about doing it.

But actually, buying a house is better than renting it, because you are making real progress towards owning an asset. And, when you are living in your own house, you have a much higher degree of security and permanence. You can do whatever you want inside your house without worrying about the rules imposed by the landlord of the property you are in. When you’re in your own house, you can set your own house rules.

Also, you can fix your financial outgoings with a degree of confidence via your mortgage payments, but rental bills may shoot up every year or two. It is quite normal for renting payments to have a price hike each time they’re reviewed, and you can’t do anything top stop it.

Owning a house is an investment. Your rented property cannot be an investment because you won’t ever own it. If you decided to move to another place, you can make use of your own house by selling it, or releasing capital from its value. You cannot do that when you are just renting . There is also a taxation benefit involved. When you decide to sell your own house, the profit is all yours without subject to capital gains tax, which means that home ownership can always out perform savings in the bank.

At My Dream Pad I offer an alternative way of buying a home, especially useful if you are still saving towards a deposit or maybe have some credit problems from a while ago that are still working their way out of the system.

You can rent-to-own my houses and flats, putting down as much “get started” money as you can comfortably afford, adding to that pot of money every month (as part of your monthly rent also goes towards buying the property), and then buy me out when you’re ready to apply for a mortgage.

With just a few clicks you can start the home buying process by filling in this short form. From there, I’ll call you straight back to get things rolling. By this time next week you could be in your own home, already making payments towards the time when you’ll take full ownership. How would that make you feel?

It’s done just the same as a car lease. You’ll pay for the property every month and eventually own the house at a time of your choosing. You can also build up your equity share at the same time, by investing in home improvements that you’ll benefit from because the purchase price is fixed at the start.

Most of all, you’ll be the king or queen of your own castle in a way that renting can never offer!

Although a great deal of hardship has been suffered, this market has also generated some real opportunities for those just coming into the housing arena. With home prices as low as they are, it is not surprising to come across homes that are selling below their value. But that news is no good to you if you can’t get the finance to take advantage.

But think about this… If I could offer you the dream of home ownership with NO bank qualifying today, would you take me up on that offer?

If you also knew that you had plenty of time to arrange your finances, maybe save a bit more cash, or even wait for a few minor credit problems to work their way out of the system.. And AT THE SAME TIME be living in your new home, ALREADY making payments towards the purchase, how would that make you feel?

No more dead rent, no more delays, no more faceless bank managers turning you away!

By next week you could be living in your own home, with your future financial security assured, surrounded by family and friends who will be delighted to share in your success. Somewhere to entertain, socialise, be the host (or hostess!) with the most. King or Queen of your own castle.

Its time to make your move… fill in this short form with a few details, and hit the submit button. I’ll call you straight back, and we’ll quickly get your journey to home ownership under way.

Every day I seem to hear that it’s getting increasingly difficult to get onto the property ladder, even if you’ve got some money behind you. The reasons range from the knock-on effects of the credit crunch to just a simple lack of suitable homes to buy in the right price range.

Why not let us know what’s holding YOU back, by taking part in the poll to the right of this page.

• Size of Deposit Needed

You’ve probably noticed that all the mainstream mortgage lenders are asking for bigger deposits, and there are very few loans at +90% of the property value. Where higher percentage lending is available you’ll also find that penalising new borrowers with higher interest rates is common. Many potential buyers have worked hard to scrape together a deposit that they though would be sufficient… only to find that the goalposts have moved, sometimes literally overnight.

• Bank Lending Criteria

Even though bankers are still earning mega bonuses, they’re nowhere near as understanding when it comes to lending out their money to home buyers. Self certification of earnings is a thing of the past, and if you’re self employed try getting a loan without three years of audited accounts!

Even if you’re in salaried employment you can expect to have your credentials examined in a lot more detail than before the credit crunch – and find that loan to earnings multiples have also been lowered.

A very small number of lenders still operate a fast track application process, but any credit rating blemishes immediately bring this to an abrupt halt!

• Lack of Affordable Property

The build programmes of the big property companies has slowed to a trickle in most parts of the UK. Not unexpected really, as home valuations have fallen dramatically to squeeze their profit margins and shareholder returns. The big builders are just sitting on their land banks for now, waiting for prices to recover before they embark on new developments – not much use if you want to buy right now!

New build homes, with the sales incentives they attract, are one of the most common entry points for first time buyers, and an overall driver of the UK property market. The overall supply of available (and affordable) properties is further diminished by existing home owners waiting out the recession before looking to move.

• Monthly Payments Too High

Many potential home owners are experiencing income problems – with overtime cuts, lost bonus payments and even redundancy impacting on the household budget. Add to this the increases in petrol, food and energy bills, and the level of cost commitment needed to buy a new home quickly becomes prohibitive.

• Credit History Problems

It has always paid to be aware of any credit related issues, and the long term damage that can happen if payments are missed. Banks have become hyper sensitive to the credit ratings of new borrowers, and will now frequently shy away from any perceived risk. Here are a couple of related articles that will help manage and overcome any skeletons in the closet.

Why it pays to manage your credit file

Credit file myths explained

Take the credit check quiz

Now take part in our Poll “Home Ownership – What’s Stopping You”, on the right of this page. After you cast your vote you’ll be able to see the results so far.

1) You can buy the house the old way with a mortgage and a 10%, 15% or even 20% deposit required by the Bank, OR …

2) You can join my satisfied rent now buy later customers and start buying the house right away with a low weekly payment and no need to qualify for a mortgage!

It’s just like renting except that, just like a normal mortgage, some of the money goes towards buying.

You can usually move into your new home in as little as 7 days!

Here’s a review of what you can expect from one of my Rent To Own agreements.

What Do I Have To Pay?

• A document preparation fee of £395

• Some “Get Started” money, based on what YOU can afford, (nowhere near what the Banks demand!), ALL of which goes towards the purchase of the property

• The rent is normal market rent per month, based on local rates for similar properties

• In addition to that you pay a ‘premium rent’ – ALL of which goes towards paying for the house and builds up your deposit for when you get a mortgage later down the line

What Else Do I Need To Know?

• The price of the house is fixed for the whole term of our agreement

• At the minimum rate, by the time you come to buy you will have saved up a useful % deposit, but the more you pay the faster and bigger your deposit will grow

• No mortgage is required until you buy at the end of the term we agree (but you can buy earlier if you wish)

• Price growth and rent deposit payments provide your deposit for the eventual lender

• House prices are rising again but YOUR purchase price is fixed at the outset so YOU gain from any price growth!

• Redecorate, carry out home DIY – YOU benefit from any added value by enhancing YOUR home

• This is not a shared ownership or Housing Association scheme – you will be buying 100% ownership

• I only use Law Society approved solicitor paperwork

• I can help you get advice on your mortgage towards the end of the term, or sooner, with your deposit fund or you can use any mortgage broker you wish.

• Move in, and buy later – or walk away! You do not have to buy if you change your mind.

• Perfect if you are either;

- A first time buyer struggling to get onto the housing market

- Struggling to raise a large deposit

- Currently renting but want to own your own home

- Have impaired credit and can’t get a mortgage right now

- Have recently moved to the UK

Please NOTE: This property will be rented UNFURNISHED ready for you to move in.

No mortgage is required whilst renting/buying.

With prices rising in 2010 these properties are never around for long so call Les on 07823 880405

My name is Les Sheppard. I’m a property investor with a difference. It’s my mission to help you get on to the property ladder and I’m going to show you how you can and you don’t even need a mortgage today.

I’m going to show you how to buy your own home without using the bank’s money until you are ready to complete the purchase – which can be years down the line!

The system is simple and effective and uses standard legal paperwork to give you what you need today – your own home for you an your family.

What is Rent To Own and How Does it Work?

Rent to own schemes (sometimes called rent now buy later, or rent 2 buy) operate just like leasing a car.

It’s very simple.

1. You make a small upfront payment (tiny compared with what mortgage lenders want!). This payment goes towards your purchase.

2. You can then move in and live in the property whilst paying a monthly amount, usually the market rent plus something extra towards buying.

3. I’ll give you a fixed price for a number of years (usually 3) so that you can get your mortgage sorted when you are ready, and you can buy the house at any time up till then.

4. Just like leasing a car, at the end of the contract (or any time during it) you can make the big payment to buy out the rest of the house (using any mortgage lender or broker you wish)

Oh, and being fixed, the purchase price won’t go up, so you know exactly how much you have to pay. If the value of the house goes up – that’s your profit.

The Nationwide Building Society just released figures that show UK house prices starting to rise again for 2 months in a row. Now could be the best time ever to fix the price of the home that you buy.

By renting now to buy later you get the benefits of home ownership today without the costs of stamp duty, mortgage arrangement fees, redemption penalties etc. You get time to build up your credit history and your deposit ready for a mortgage.

If you’d like to know more then give me a call on 07823 880405. I look forward to speaking to you soon!

It makes sense to proactively manage your credit file (the reference files used by all the major lenders to check your viability for a loan) so that you can be confident of getting the finance you need, at the best rate possible, when the time comes around.

Many people are not even aware that their credit rating, scored out of a thousand by the major agencies, effects the loan percentage rates offered as well as the loan decision in principle, or that it is possible to access this information on a regular basis to make sure it accurately reflects their current status.

The three main credit reference agencies are Callcredit, Equifax and Experian, and the advice below is taken from their own recommendations to subscribers.

• Be somewhere, so your credit can be checked! – It’s vital that you are registered on the Electoral Role for your primary address, so that your details can be found for checking. Your score may be lower if lenders are unable to locate you.
• Court Information – includes judgements made and voluntary arrangements you have agreed, and this info stays on your credit file for 6 years. Potential lenders make little distinction between satisfied and unsatisfied judgements, but it’s still important to challenge anything that is not 100% accurate.
• Number of searches - every time someone searches your credit file, a search “footprint” is left on your report so that you can identify who has been looking at it, why and when. These stay on your file for 6 years, and expire automatically. Too many footprints may have a negative impact, so limit the number of applications you make where possible.
• Credit Accounts - records are kept of your total borrowings (Mortgages, Loans & Credit Cards) and how actively your Credit Cards are used. Surprisingly for some, cards with zero balances and no activity can be viewed as risky by lenders – and it’s useful to make some purchases on each card account you own, and then pay the balance off, to demonstrate that you can use credit facilities wisely.
• Mortgage problems / Fraud warnings - the Council of Mortgage Lenders report on repossessions, and an agency called CIFAS reports on fraud. Either entry on your credit file would mean that further checks are made to verify your identity and viability for lending. Refusal is not automatic, but delays and further referencing could be anticipated in these circumstances. CIFAS entries don’t directly affect your score, but you need to make sure that there are no inaccurate entries on your file.
• Gone away records - failure to keep your existing lenders fully informed of your address movements can have a negative impact on future lending decisions. Make sure you keep everyone up to date with changes.
• Notices of correction - finally, everyone has the right, under the Consumer Credit Act 1974, to add a “Notice of Correction” of no more than 200 words on their own credit file. This enables you to give a clear explanation of any wrong or misleading entries.

We’ve found an excellent resource that will allow you to manage your credit files, with all three leading agencies, easily online. Check out CheckMyFile.com, where you can gets tons of free information (including a free credit score and a full report for less than £10), and access to all the data you need to get in full control of your finances.  This IS very important for your future property purchases and borrowing power, so don’t delay!

One of my rent-to-own home offers some distinct advantages that make it a wise strategy for someone who is unable to qualify for a mortgage today. Five of these advantages are:

Saving a Down Payment

The goal of a rent-to-own home is to give a qualified tenant/buyer the tools to buy a home sooner. A tenant leases a home they want to eventually own for a specific period of time in order to do two things – build a down payment and fix their credit.

In the UK a potential home buyer currently needs a down payment of at least 5% plus transaction costs in order to qualify for a mortgage loan ( and at 95% loan to value, the interest rates will be very high!).

The first advantage of a rent-to-own home is that it acts like a forced savings plan because a fixed amount of the rental payment is set aside each month. A typical home purchase via My Dream Pad helps a tenant save enough money by the end of the lease term to qualify for a mortgage with any leading lender.

Repairing Personal Credit

The other half of the rent-to-own picture involves helping a tenant/buyer repair their credit. Sometimes a tenant is able to do this by simply making their monthly payments on time. Other times they may need to work closely with a credit counsellor to rebuild their credit score or reduce their existing debts throughout the rent-to-own term.

The combination of a good credit score, well managed debts, and a reasonable down payment will help the tenant in getting the banks to say yes when they apply for a mortgage. They will have also gained in financial experience while making themselves more attractive to lenders in the future.

Fixed Monthly Payments

The third advantage of a rent-to-own home is that monthly payments are fixed for the full term of the lease. A normal rental agreement in the UK allows the landlord to increase rents by a certain amount once every 12 months.

This isn’t done with a rent-to-own agreement because increasing the monthly payments by any amount could affect its affordability for the tenant. A fixed monthly payment provides the tenant/buyer with cost certainty and allows them to budget knowing that their basic housing payments will not increase.

Guaranteed Purchase Price

In addition to a fixed monthly lease payment my rent-to-own scheme also fixes the future purchase price of the home at the outset.

Before deciding what the final purchase price will be, the tenant’s current household income, outstanding debts, what they can reasonably afford to buy, and historical property prices in the chosen neighbourhood have already been considered.

Agreeing to the price in advance gives a tenant/buyer the peace of mind that their “get started” money will be enough to buy the home regardless of what its actual value is.

Build Instant Equity

Once a tenant/buyer is approved for a rent-to-own home they are required to pay a document preparation fee of £395 – and their available “get started” funds. This is eventually counted towards the final purchase of the home, giving the tenant equity in the home from the day they make their deposit.

A tenant isn’t limited to the equity created by their down payment though. Most home owners will usually make some type of upgrade to their home, whether it is a deck in the backyard or new cabinets in the kitchen.

The same is often true in a rent-to-own because a tenant/buyer doesn’t have to wait until they’re able to buy the home to start making improvements to it. With my approval you can make upgrades that will usually increase the value of the home and create additional equity for yourself when you buy the house.

A tenant/buyer that’s unable to qualify for a mortgage today can use my rent-to-own scheme to buy a home in as little as 24 or 36 months. This method helps to save a useful down payment and repair their credit. Fixed monthly payments and a guaranteed purchase price provide them with cost certainty.

So it is possible to have your cake and eat it too!

Why not start your journey to home ownership right now… By filling in this short contact form. I’ll then call you straight back to get the ball rolling.

Simply that they’re problems – and your ability to solve them and move forward has an enormous impact on your property investing success. Some people are natural problem-solvers, but for those of us who aren’t, there’s good news: problem-solving skills can be honed just like any other sales skill, says Harvey Deutschendorf. In his new book, The Other Kind of Smart , Deutschendorf offers these five techniques for becoming an expert problem solver:

1. Practice every day. Every day, think about possible problems that could arise in your portfolio building efforts and come up with multiple solutions to them. For example, your regular lender is not taking on new business – which ways could you go? Your legal team promised feedback on a contract by Friday; it’s Monday, and they still haven’t got to it – what do you do? In moments of downtime, such as driving to work or waiting to meet with a seller, come up with an imaginary problem and try to think of several solutions to it. This exercise has two benefits. First, if your imagined problem becomes reality, you’ll already have ideas about how to handle it, and thus you’ll be less stressed and more effective. Second, you’ll develop the skills you need to solve any problem that arises in your life.

2. Seek multiple solutions. Always think of problems as having more than one solution. Think in terms of better answers, instead of right or wrong. The more solutions we have, the better our chances of picking a good solution. So don’t stop at the first answer you come up with, even if you think it’s a winner. Not only are you likely to hit on even better ideas the more you develop them, but you’ll have alternatives in case the first solution turns out to be a dead end.

3. Get your ego out of the way. Don’t allow your ego to become entwined with your problem-solving efforts. Seek out the help and input of others when you need it and be ready to acknowledge when someone has a better solution than yours. Successful people have an array of tools with which to solve problems, theirs as well as those they borrow from others. They have learned to put their egos aside and use whatever information and ideas that work best.

4. Be great, not right. In solving problems, keep your focus on being successful, not on being right. This technique goes hand in hand with zapping your ego. Take it from Bill Gates, who initially did not see the potential of the Internet. When he realized he’d been mistaken, he was quick to acknowledge it and began investing heavily in the Internet. His focus on success rather than on being right is one of the major reasons he’s one of the world’s wealthiest men.

5. Reward yourself. When you come up with a great solution to a problem, reward yourself. It will give you a little added incentive to do great problem solving the next time a problem crops up.

Problems are an everyday reality for property investors. Often, the difference between those who are consistently successful and those who struggle lies in the way they respond to those problems. Strugglers often become stressed and frustrated and are quick to place blame on others. Successful people, on the other hand, keep their energies focused on solutions – and it tends to lead to more success.

Developing our ability to cope with and overcome problems has a positive effect on our ability to tolerate stress. Every problem that we successfully solve gives us increased confidence that we will be able to solve the next one.

Got a great problem solving story? Feel free to leave a comment…

Why some get massive profits while the majority are still dreaming about their first buy?

They did not get “lucky”

They don’t have two brains

The difference is this…

They consistently work at the performance of their portfolios each and every day.

But they haven’t mastered each and every trick or method under the sun! Just think about this – there are so many methods and tactics to learn that it will take forever to master all of them.

There is buy-to-let, property flipping, refurbishment, no-money-down, multi-let, refurbish/refinance, let-to-buy, social housing, off-plan, overseas off-plan, cash flow planning, product switching…

Do you really think you have the time to learn all this BEFORE you make a move? And even so, what guarantees you’ll have the time to apply each and every tactic on a regular basis – which is key to getting massive results and great deals.

Now back to the main question – what makes the pro investors successful?

What do they know that you don’t?

The answer is that they have mastered just a few portfolio building methods. And the most shocking part is this: They spend less time and make more money than the rest of the investors out there. Isn’t this incredible? Work less and get paid even more.

HERE’S WHY THIS WORKS:
Because the pro investors know what works and they stick to it.

Yes, they’re focusing on the activity which makes the most impact in their portfolios profitability.

In upcoming posts I’ll introduce you to some of the most popular and most successful tips.

Stay tuned. You have seen nothing yet.

Go to next in series…