Rent a house with right of redemption it is a very common practice, it is a contract stipulated between the buyer/tenant and the owner of the property; with the signing of this contract the tenant acquires the right of redemption on the property after a period in which he pays the rent, the period usually varies from 2 ai 5 years.

This practice of rent a house with right of redemption it is very advantageous for the tenant as the rents paid over the years will be subtracted from the final purchase price and will be considered as advances on the selling price.

How to proceed to rent a house with right of redemption?

Upon signing the contract, the tenant will pay the deposit which usually corresponds to two months' rent, after which he will continue to pay the monthly rent every month., at the end of the rental period agreed in the contract, the calculations will be made and the sums of the deposit and monthly rents already paid will be deducted from the purchase price of the property, Let's take a small and simple example.

If the property is expensive 250.000 euros and we have stipulated a rental contract with right of redemption at 1.000 euros per month for 5 years the result will be the following:

250.000-
1.000 x 60 (60 are the months in 5 years)-
2000 (deposit or two months' rent)=
250.000-60.000-2.000= 188.000 euro

L’rental with future sale agreement o rent with right of redemption as you can see it is very convenient and is designed for all those people who want to buy a house and do not have a large down payment to pay, in fact, to purchase a house, a down payment of approx 20% on the total amount, in the specific case, for example, a person who wanted to purchase the property a 250.000 euro should immediately pay an advance of 50.000 euros, calculating that banks usually do not grant mortgages exceeding 80% of the value of the property you intend to purchase, with this practice, however, it is not necessary to pay any advance and the rental payments and the deposit will be deducted from the price of the property at the time of redemption.

When exercising the right of redemption on the property, the tenant will be able to go to the bank and take out a mortgage.

SOURCE: ITAblog