Selling a house “Rent To Own” has advantages for homeowners

Are you thinking of selling your house in Warner Robins, Georgia in the near future? You may want to consider selling rent to own. Rent to own can have advantages that you have not thought about.

The real estate market in Warner Robins Georgia is changing. Some say it is “getting back to normal” after covid. Whatever the reason, prices are not climbing anymore. In some places, prices are starting to drop (correct, in stock terms).

Selling houses in Warner robins Georgia

This correction may leave some homeowners in a bind. They bought their house when the market was high and now they have to sell their house at the same price or less. This, along with possible closing costs and taxes, can cause a homeowner to come out of pocket to sell their house. Selling a house “rent to own” can help reduce the loss or even create a gain for the you.

Why selling a house rent to own can be great for homeowners

rent to own documents

#1. Control Terms of selling

In Warner Robins, rent rates are a premium. Tenants are paying rents that are higher than most house mortgages. This means a tenant can pay the same or more than the mortgage payment until it gets paid off in the future. In the meantime, a homeowner can use any extra proceeds from the rent to maintain the house and/or buy down the underlying mortgage faster.

Purchase option

Since a tenant is the potential buyer, many sellers ask for a fee for the option to buy the house later with bank financing (once they qualify). This fee can one-time or yearly fee for each year the tenant does not buy the house. This can offset the cost of selling the house while the rent is paying down the mortgage balance.

Contract for Deed

The homeowner can also sell the house in an agreement that a portion of each payment is credited to the balance of purchasing the house in what is known as a “contract for deed” (be the bank). The tenant (now buyer) pays a down payment and part of each months rent goes to the equity that has not been paid yet. The homeowner can control how the payments are structured. If there is an underlying mortgage, make sure that it gets paid off before the buyer’s loan to you or you could risk a big mess.

Make sure to talk to a professional when structuring a rent to own sale of your house.

#2. Get more for your house

Rent to own tenants are in the market to own their own home, but can not qualify for a bank loan. Many self employed and contract business owners fall into this category. They are willing to pay a little more for the house if financing is part of the purchase.

Every homeowner knows the cost of a loan to buy a house is the interest. NOW, the homeowner can make that money back by being the bank. Most people that do not take full payment for the sale of their house at closing charge interest on the unpaid balance. A rent to own sale is no different. A portion of the rent stays rent (your interest), while a portion of the rent is credited to the balance of the purchase.

list your property

#3. Rent to own tax benefits

Rent to own buyer are tenants until they buy or refinance the purchase of the house. This means the house is in the selling homeowner’s name until the terms of sale are complete. This also means the selling homeowner could choose to keep the tax benefits until the sale is complete.

Since the tenant is “renting” the house, the selling homeowner can depreciate the house as a rental. This is an added bonus in tax savings.

If the selling homeowner fixes anything in the house during this sales period, that can be written off as rental expense.

If there is an underlying mortgage being paid, the interest can still be written off as an expense of a rental property.

**Please consult your tax professional before using any of these tactics.

#4. Easier To Sell

As mentioned before, there are a lot of business owners and sole proprietors that make good money, but do not earn what the bank likes to call “a W-2 paycheck”. Banks like to qualify borrowers that have a steady W-2 income because that income is designated to the borrower from the company they work for. Many sole proprietors don’t take a paycheck from their own company. Banks don’t qualify the company revenue as belonging to the borrower, so what the business owner makes does not qualify as “borrower’s income”.

A house listed for sale to buyers that have bank financing may have fifty buyers, but a house that is available as a rent to own will have one hundred and fifty buyers. More buyers means a faster sale of the house, even in a falling market.


There are many other benefits to selling a house as a rent to own. What would be your favorite? Make a comment below. Ask a question.

If you have any questions, you can also reach us at Keller Williams of Middle Georgia.

Please leave a comment. What did you think? Do you have something to add? Share your experience and share this page!!

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2 responses to “Selling a house “Rent To Own” has advantages for homeowners

  1. Chris – great article! This strategy is great simply for the tax benefits alone! The words “Rent-to-Own” are like magic when marketing a property. So many people want the dream of homeownership but, as you mentioned, are restricted by institutional lending requirements. I’ve used this model many times before and always had to turn people away because of the large number of applicants. Even at the worse time of the year (winter / holidays) we had no trouble finding tenant / owners.

    1. Yes Sir, plenty of good buyers that can pay the price. The banks just don’t want to take the risk because of some company policy about W-2 income. Why shouldn’t the seller get their asking price AND some interest in exchange for a buyer getting the home they want without using a bank? A WIN-WIN for everyone.

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