Our Rent‐Back ProgramInformation For Families Who Want 

To Stay In Their Home During Financial Difficulty

THE SHORT-CUT TO YOUR FAMILY’S NEW HOME

Are you in danger of losing your hometo foreclosure or power of sale?

Do you have at least 15% equity … but can’t access it?

Follow our plan, and stay in your home– then in 1 to 4 years you’ll

get a mortgage and OWN it again!

THIS PROGRAM IS FOR HOMEOWNERS WHO…

are behind on mortgage payments cannot refinance or renew due to self employment,

divorce, identity theft, overleveraged, etc. are in (or should be in) a consumer proposal or

bankruptcy have a good income but a poor credit rating

HOW DO YOU QUALIFY?

Income should be 30% or more of home value - eg. a $300,000 home requires $90,000 combined household income (pre-tax)

Bad credit does NOT stop you from qualifying

Bankruptcy or Consumer Proposal do NOT stop you from qualifying – but you will have to follow a credit repair program if you want to regain ownership of the home

We require thorough proof of income etc.

ADDITIONAL REQUIREMENTS FOR RENT-BACKS

For rent to own financing scenarios, we absolutely cannot proceed until you have provided the following: a title search of your home so that we are not

surprised by any liens or 2nd/3rd mortgages which the home owner may or may not have been aware of (at google.com, search “(your city) (your province) title search” and choose an option)

a realtor’s assessment of your home’s market value a mortgage discharge letter from your lender, which

states your cost to escape your mortgage, including the balance and all arrears and penalties

HOW DOES IT WORK?

Screening process – similar to mortgage application.

We will need your credit report from EquiFax.ca

Down payment of anywhere between $10,000 and 10%+ of the home’s value will be required, depending on the current availability of investors for rent-back deals. Also depends on which region of Ontario or Canada you’re in, and so on (down payment requirements for rent-backs are higher than those for “normal” rent to own deals, because investors are concerned about your ability to get a mortgage to buy the home back).

We assign you an RTO realtor to take you through the process. The realtor often brings us the investor, and must be compensated. Therefore, in rent-back situations, YOU may be responsible for the realty fees, which are usually 2.5%, but may be a flat $5,000 to $10,000 (your realty fees when you buy back your house will be $0).

YOUR COSTS

Down payment due will be paid out of your equity, to the investor (buyer/landlord) on the day that ownership transfers

First, and sometimes last month’s rent are due prior to moving in for normal RTO deals – but with rent-backs we reduce the landlord’s risk –and give some breathing room to you – by having you also pre-pay 6 – 18 months rent, out of your equity, to the landlord on the closing date

Every month, your lease payment consists of a “Base rent” amount plus a “Purchase Option” (down-payment-builder)

Example: If your base rent is $1,500 and your purchase option is $300, you pay $1,800 a month rent, and your accumulated down payment after 3 years is 36 months x $300 = $10,800 plus your initial down payment

WHAT WILL YOUR RENT BE?

Your total rent consists partially of your purchase credit, which builds your end-of-lease down payment percentage requirement. If your down payment target is 20% while someone in a similar house has a 10% target, your rent will be higher than the other person’s. It’s all based on your eventual mortgage requirements.Calculations vary from one landlord to the next – the total monthly rent is usually between .0065% and .0075% of the initial house value (higher for cheaper houses, lower for expensive ones – like normal rent). Please understand we can only provide you with estimates here. All of these terms are open to negotiation by both landlord and tenant prior to striking a deal.

Initial House Value Total Rent Probably … Purchase Credit$180,000 $1300 to $1550 $150 to $250$200.000 $1400 to $1600 $150 to $250$225,000 $1500 to $1700 $200 to $300$250,000 $1600 to $1750 $200 to $300$275,000 $1700 to $1900 $200 to $350$300,000 $1850 to $2100 $200 to $400$325,000+ varies according to many factors

BUYING YOUR HOME

Your purchase price after 2 - 4 years is pre-determined. If you wish, you can buy the house at pre-determined pricing at ANY time during your tenancy. Buy-out pricing is based on an annual appreciation.

You acquire your own mortgage and officially buy the house from your landlord in a private sale (no realty fees). You will have built up a down payment of usually about 10% - 20% of your end-of-lease purchase price.

*** If your down payment requirement exceeds the credits you’ve built up during your RTO lease, you will need to have saved the extra funds to make up the difference when you apply for your mortgage.

Your “Purchase Option Contract” (separate from your lease) obligatesyour landlord to sell the house to you at ANY time during your lease.

A WIN-WIN FOR YOU AND YOUR LANDLORD

Landlords are fed up with tenants who don’t respect their properties Rent-back RTO tenants have pride of ownership and a greater sense of

responsibility (not to mention better income and personal qualifications) than the average renter. They’re also less likely to break a lease without notice.

Landlord earns small annual appreciation included in the buyout price (Note: your landlord will of course buy the house as cheaply as possible at the outset)

If your buyout price is slightly less than future market value, this is free equity to you If your buyout price is slightly more than future market value, you’ve still kept your

home (and neighbours, and schools, etc.). What price would you put on that? The rent-to-own process gives you personal hands-on mortgage qualification

assistance, credit repair and access to great lenders. Credit repair combined with home ownership gives you a dramatically more powerful financial position.

At buyout time, your private purchase has $0 real estate fees, saving you $5,000 to $10,000 in most cases

You’re paying only slightly higher than normal rent (and getting credit), while the landlord pays mortgage principle and interest and property tax during your lease

YOUR RESPONSIBILITIES

Your lease will describe your duties ...

Lawn care, snow removal General maintenance Rent payment schedules Consequences of late rent payments Deductibles for damages, appliances etc.

(In standard cases, your appliances and window coverings are included in the sale from you to the investor, and vice versa)

HOW YOU ARE PROTECTED

Your Lawyer is your first line of defense to review the deal, review your contracts, and provide their professional advice and experience

Mortgage agent, mortgage industry laws, professional code of ethics

Realtor, real estate industry laws, code of ethics – in many deals, a realtor is also involved in the process of finding the investor, and negotiating for you

Tenant and Landlord Acts, by province Purchase Option Contract prevents owner from

attempting to sell home, change title ownership etc. Lease Agreement – standard protections

“WHAT IF?” …

We ask tenants to take their mortgage eligibility seriously.

Credit repair steps and goals will be made clear.

But “Stuff Happens” … so if needed, you can ask your landlord to add time to your lease … or ask for vendor financing. Any such arrangements are strictly between you and your landlord.

To put down payment forfeiture into a more familiar light, compare it to these familiar situations:

- car lease: down payment and monthly payments – hassome similarities and differences from RTO

- home foreclosure – down payment (equity) loss due tomissed payments, inability to finance/refinance, legalpenalties --- similar to doing RTO then not buying the home

DISCLAIMER AND LEGAL INFO

The terms of this disclaimer must be accepted to access and use RTO Partners documents or join our email updates list or use any RTO Partners web site content or standalone document. This document is an interest seeking document only. No information, forward looking statements, or estimations represent any final determination. This document is for general information purposes only. While the information presented in this investor interest seeking document has been researched and thought to be reasonable, in general, real estate investment is highly speculative, real estate values can go up or down, and thus RTO Partners AND/OR ITS AGENTS CANNOT AND DO NOT GUARANTEE ANY RATE OF RETURN OR MARKET VALUATIONS OF ANY PROPERTY AT ANY TIME. User of this document acknowledges and agrees that RTO Partners and/or its agents are not in the business of real estate consulting and are not classified, or presenting themselves, as real estate experts, professionals, or developers but preliminary information providers. The reader further acknowledges and agrees that RTO Partners does not assume and hereby disclaims any liability to any party for any loss or damage caused by the use of the information contained herein or errors or omissions in the information contained in this investor interest seeking document to make any investment decision in the venture referred to herein, whether such errors or omissions result from negligence, accident or any other cause. Note, however, that buyer participation is secured by agreements including but not limited to a lease agreement and a purchase contract. Buyers should conduct their own investigations, analysis, due diligence, draw their own conclusions, and make their own decisions. Any areas concerning taxes or specific legal or technical situations should be referred to lawyers, accountants, consultants, realtors, or other professionals who are licensed, qualified or authorized to render such advice. IN NO EVENT SHALL RTO Partners AND/OR ITS AGENTS BE LIABLE TO ANY PARTY FOR DIRECT, INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER ARISING OUT OF THE USE OF THE INFORMATION CONTAINED HEREIN.

MOVING AHEAD ...

Visit our web site or contact us any time to complete an application or ask us questions.

Toll-Free: 877 813 6171

http://www.RTOpartners.ca

Sue@RTOpartners.ca

ADDITIONAL TOPICS ...

Debt Relief: (even if you are not planning to rent to own a home)

Most of our clients have some debt problems, and should visit http://RTOpartners.ca/debt-relief to find out some things that most credit counselors and trustees will not tell you – and possibly lower your debts by 50% to 70%.