3. Rent‐to‐Own process - ZoWy

Rent‐to‐Own process.

Agenda:

  • • Understand the whole process from the enquiry until the final purchase

The whole process is straightforward and designed to be as tenant buyer friendly as possible.

The initial enquiry is essential. As each potential tenant‐buyer has different circumstances, we are here to listen to what is required. We have designed a full Fact Find to complete all relevant questions and create a tailor‐made solution for each client. Once the Fact Find is completed, and we can help, and clients wish to go ahead, we need to meet all compliance requirements. Therefore, we need to see everyone's proof of ID, proof of address and proof of deposit.

Once we receive all the required documents, we are ready to book viewings for chosen properties. Once a future tenant‐buyer decides on the property, we do additional due diligence on both the tenant‐buyer and the general circumstances of the purchase. Finally, we make a final acceptance of the tenant‐buyer together with the absolute terms of the property purchase. Depending on the circumstances, we sometimes require a higher deposit to cover additional requirements and extra risk. To book the property of tenant‐buyer choice, we will need a holding deposit to be paid. The amount depends on property price but is between £500 and £1000. The holding deposit goes towards the deposit. If the tenantbuyer decides not to proceed with the property, the whole amount is lost. Suppose ZoWy, for any reason, decided not to move with either tenant‐buyer or property. In that case, the holding deposit is refunded in full.

Once we have all terms agreed, we forward a Lease Purchase Agreement and Assured Shorthold Tenancy agreement to be signed. Each tenant buyer can sign electronically or with a wet signature. The solicitor creates each Lease Purchase Agreement to meet all legal requirements. Each Tenant‐Buyer can have it checked by an independent solicitor, but it is not required to complete the process. The Lease Purchase Agreement is nonregulated in the UK and therefore can be done without solicitor involvement. We expect a deposit and first rent payment to be received together with a signed Lease Purchase Agreement as soon as possible and typically in 14 days.

Once we receive a deposit and a signed Lease Purchase Agreement, we arrange the moving in date. It can be done as soon as the very next day if required!

Within the Lease Purchase Agreement, everyone has a date by which the property must be purchased. It is crucial to do so within the set time, as otherwise, the tenant‐buyer can lose the right to buy the property. The mortgage arrangements have to start early enough to secure the finance to buy the property. We will recommend a trusted mortgage advisor to do an annual check on how each tenant‐buyer is getting ready for a mortgage application. Still, the ultimate responsibility lies with each tenant‐buyer to ensure that everything is going according to plan. It may mean building a good credit history, saving more towards a deposit and having sufficient income for the mortgage.

Once the mortgage is arranged, then the conveyancing process is organised. It is done by a UK solicitor and involves doing several legal searches, enquiries and finally transferring the property into the tenant‐buyer name at the end of the process. The process can take three months or more and usually only starts once the mortgage is obtained. Therefore, everything must be done early and on time. The tenant‐buyer is doing relatively little within a conveyancing process. It is done by a solicitor who provides updates and reports to the tenant‐buyer.

Once the solicitor is ready, the tenant‐buyer needs to sign a final contract and mortgage deed and transfer the outstanding deposit, if required, to the solicitor.

Once you sign a Rent‐to‐own agreement and move to the property, then you are a tenantbuyer.


Further reading:

Rent‐to‐Own process.

Agenda:

  • • Understand the whole process from the enquiry until the final purchase

The whole process is straightforward and designed to be as tenant buyer friendly as possible.



The initial enquiry is essential. As each potential tenant‐buyer has different circumstances, we are here to listen to what is required. We have designed a full Fact Find to complete all relevant questions and create a tailor‐made solution for each client. Once the Fact Find is completed, and we can help, and clients wish to go ahead, we need to meet all compliance requirements. Therefore, we need to see everyone's proof of ID, proof of address and proof of deposit.

Once we receive all the required documents, we are ready to book viewings for chosen properties. Once a future tenant‐buyer decides on the property, we do additional due diligence on both the tenant‐buyer and the general circumstances of the purchase. Finally, we make a final acceptance of the tenant‐buyer together with the absolute terms of the property purchase. Depending on the circumstances, we sometimes require a higher deposit to cover additional requirements and extra risk. To book the property of tenant‐buyer choice, we will need a holding deposit to be paid. The amount depends on property price but is between £500 and £1000. The holding deposit goes towards the deposit. If the tenantbuyer decides not to proceed with the property, the whole amount is lost. Suppose ZoWy, for any reason, decided not to move with either tenant‐buyer or property. In that case, the holding deposit is refunded in full.

Once we have all terms agreed, we forward a Lease Purchase Agreement and Assured Shorthold Tenancy agreement to be signed. Each tenant buyer can sign electronically or with a wet signature. The solicitor creates each Lease Purchase Agreement to meet all legal requirements. Each Tenant‐Buyer can have it checked by an independent solicitor, but it is not required to complete the process. The Lease Purchase Agreement is nonregulated in the UK and therefore can be done without solicitor involvement. We expect a deposit and first rent payment to be received together with a signed Lease Purchase Agreement as soon as possible and typically in 14 days.

Once we receive a deposit and a signed Lease Purchase Agreement, we arrange the moving in date. It can be done as soon as the very next day if required!

Within the Lease Purchase Agreement, everyone has a date by which the property must be purchased. It is crucial to do so within the set time, as otherwise, the tenant‐buyer can lose the right to buy the property. The mortgage arrangements have to start early enough to secure the finance to buy the property. We will recommend a trusted mortgage advisor to do an annual check on how each tenant‐buyer is getting ready for a mortgage application. Still, the ultimate responsibility lies with each tenant‐buyer to ensure that everything is going according to plan. It may mean building a good credit history, saving more towards a deposit and having sufficient income for the mortgage.

Once the mortgage is arranged, then the conveyancing process is organised. It is done by a UK solicitor and involves doing several legal searches, enquiries and finally transferring the property into the tenant‐buyer name at the end of the process. The process can take three months or more and usually only starts once the mortgage is obtained. Therefore, everything must be done early and on time. The tenant‐buyer is doing relatively little within a conveyancing process. It is done by a solicitor who provides updates and reports to the tenant‐buyer.

Once the solicitor is ready, the tenant‐buyer needs to sign a final contract and mortgage deed and transfer the outstanding deposit, if required, to the solicitor.


Typical Rent‐to‐own scenarios:

Further reading:

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