rent versus rent-to-own

If you want to be a millionaire, every activity that involves money, no matter how little, is important.

The topic today is what most of us do want to avoid every end of the month - house rent!

Are you tired of paying your monthly rent?
Are you tired of feeling cheated out of thousands of PESOS each month?
Would you rather have that money for you rent to go into the monthly amortization of a place you can call your own, but you think you can not produce the required down payment for a house or condo OR you can not afford to wait for 2 years before you can live in that house or condo?

Well, I do.

See, I am paying P7,000 for house rent each month. That's P84,000 a year AND P840,000 in ten years! That's a lot of money considering that I want to be a millionaire. So what can a girl do?



Actually, there are two options and I will discuss here the advantages and disadvantages of each options.

1. Buy a house through Pag-ibig
   
2. Rent-to-own your current place

Buy a house through Pag-ibig
Advantages

• you get to choose where, what and how much to commit. Buying a house is not as difficult as before - the government has established support financial institutions for the average Filipino to be able to own a house. However, it is STILL a long term commitment. [I pay for my condo not until the next 15 years]
• when you retire, you have a rent-free house to use. Monthly house rent puts a considerable strain in a retiree's budget.
  

Disadvantages

• you might have come to love the place you are staying in now and hesitant to relocate.
• affordable houses are usually located somewhere out-of-center OR off the city which could mean additional transportation cost

Rent-to-own your current place
Advantages

• you'll be buying a house you have come to love
• no additional moving expenses
  

Disadvantages

• you're land lady/lord might NOT be willing to sell, hence give him/her an offer he can't refuse!

How does one go about Option # 2?

First, discuss with your bank your plan to buy the place you are currently renting.
Second, ask your bank how they can help you.
Third, show your offer to your land lady/lord

Banks often enter into transactions like this. The bank offers to buy the house for you, then asks you to make monthly payments until you pay off the debt. At that time, the bank will transfer the title of the house to your name.

However, if you'd rather buy a brand new house here are useful links:

1. ABGarcia Const.
2. Affordable houses
3. Rent to own
   

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[Image from www.daasgallery.com]