Ohio rent to own (land)

[bkre05]

What is the name of your state (only U.S. law)? Ohio

I am not a resident of Ohio, but have been offered some land (3.5 acres - undeveloped) on a rent to own agreement. The key features are:

1. Three years of monthly payments
2. 7% interest
3. $1 purchase price executable only at the end of the three year term
4. Forfeiture of all rent paid if I fail to meet the terms of the agreement

Does this sound above board? I'm not at all familiar with rent to own agreements.

Thanks

 

[STEPHAN]

How much is the total?

 

[OHRoadwarrior]

Make sure to have a written contract, with clear terms, registered with the clerk of courts in the proper county. The price you wish to pay is up to you.

 

[bkre05]

rehio rent to own

The agreement would be to rent the land for three year at $480/mo. That totals at $17280. At the end of that three years I would have the option to purchase the land for $1. If I walk away at any point during the three years (change my mind, fail to make payments, etc) I forfeit all payments to that point since they were rent. The seller is also willing to let me pay the land off at any point for the remaining rent payments plus $1.

 

[bkre05]

clarification...

The 7% interest is not stated in the agreement anywhere. It is what the seller used to figure the monthly rental payments. Additionally, I mispoke in the first post. I can execute the $1 purchase of the land by making all remaining rental payments + $1 at any point.

 

[TigerD]

That isn't a rental agreement it is a sales and financing agreement disguised as rental. You would be well served to spend a couple of hundred dollars with a qualified real estate attorney before signing this deal. The actual contract terms are important.

TD

 

[LdiJ]

That isn't a rental agreement it is a sales and financing agreement disguised as rental. You would be well served to spend a couple of hundred dollars with a qualified real estate attorney before signing this deal. The actual contract terms are important.

TD

I agree. I would want it set up as a contract sale rather than a rent to buy. You need some protection too. You would not want the seller to be able to walk away and keep all of your payments if you happened to be one day late, (for example) on a payment when you were almost finished.

 

[FarmerJ]

If this lot does not have access to city water & city sewer then what are the rules of the county it is in for putting in onsite septic system and private well ? and your ability to build , is there any restrictions at local govt level that would bar you from building or limit on the lot where you can build ? Those things would be important too. And yes do see a Attorney to review this so called contract.