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» VISIT US ONLINE @ DSNEWS.COM 71 COVER STORY INDUSTRY INSIGHT INDUSTRY INSIGHT INDUSTRY INSIGHT maintenance and repairs. And it's a big potential market. More than 11 million households spend at least half of their income on rent, which continues to soar. It could make more sense for them to own, if they only got the opportunity. at's where rent-to-own companies come in. Rent-to-own companies offer lenders a fair price for their properties—in cash—and close quickly, which is an attractive option for lenders and servicers that have been sitting on these nontraditional assets for some time with no plan or process to liquidate them. Rent-to-own companies buy bank-owned and distressed homes from all of the major banks and servicers, both one property at a time and in bulk. And they're always looking for new inventory sources. At Vision Property Management, we may also flip the property to a local investor from our huge buyers list, but rent-to-own tends to be our predominant business. A TRIAL IN HOMEOWNERSHIP e ultimate goal is to put in occupants willing to do the work to get the house back to a marketable position, so it is a functioning property that's contributing to the neighborhood and raising community values. Many of these homes have critical maintenance issues that have to be dealt with before the tenant can move in, such as a new roof or HVAC system. at's the property manager's responsibility after purchasing the home, but when it comes to things such as carpeting, painting, or upgrading appliances or fixtures, that's the responsibility of the occupants according to their personal tastes, just as if they owned the home outright. And they certainly get the opportunity to do just that. For many, that's their ultimate goal. Rent-to-own lease agreements are typically seven years, but once the tenant has been paying on time for three to four years, the property manager may offer them the chance to purchase the home early. Some will even recommend a lender or prepare the tenant for maintaining and caring for their home. One of the advantages of the lease-to-own option for potential homeowners is that they do not have to be subjected to a deep dive into their credit history in order to sign a lease, though they do have to have a stable job and income. ere are no fees to apply, and the entire process can be done online. It's crucial the process be as simple as possible for the consumer, as this puts them at ease about the transaction. FINDING AND PREPARING THE TENANT ere are a number of ways to find rent-to- own tenants, like lawn signs and other forms of physical advertising, but listing properties on major auction websites like Trulia, Zillow, and Auction.com are often the most successful. ese sites also allow renters to arrange tours and apply online. Once a tenant is interested, it's important to incentivize them through their rental agreement. Give them credits each month, so they can build potential equity in the home. For example, the tenant might earn $50 of each $500 monthly payment that goes toward a balance that is owed. After three or four years, if the tenant is interested in purchasing the property and can qualify for a mortgage, the two parties can then negotiate a mutually acceptable sales price and draw up a purchase agreement. It's important that after the lease agreement is signed that tenants are not left alone. Each renter should be assigned a customer service advocate who will be responsible for working with them to make sure their payments are submitted each month. In the event the customer runs into a problem and they can't makex their payment, they know who they can call. Eviction is never a good option for anyone— including the property manager—so the goal should be to help the tenant stay in their home, even if they run into problems. ough legally, you may be allowed by contract to start the eviction process after 30 days, consider extending beyond that and have an attorney try to reach a resolution with the tenant. Understanding each tenant's unique life situation is important with rent-to-own arrangements. Many rent-to-own consumers are habitual renters who want homeownership but have struggled to achieve it. As long as the tenant is willing to work, property managers should take any steps they can to keep them in the home. is type of approach is typically successful for both parties. Vacant homes remain occupied and get restored, and the tenant gets real-life experience in homeownership, as well as equity in the property. Additionally, improving the property helps prospective homeowners, lenders, and the community at large. And that's the overall goal. By turning renters into homeowners, we can restore America's neighborhoods and fight community blight. "More than 11 million households spend at least half of their income on rent, which continues to soar. It could make more sense for them to own, if they only got the opportunity."

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