RTO Partners was created to help people achieve their goal of home ownership. RTO Partners is comprised of Real Estate, Marketing, Mortgage and Financial Professionals who see the need to help educate would be buyers on alternative options for home ownership. With credit markets tightening up, it has become ever more difficult to get approved for Mortgage financing. In addition, if you’ve had some hardship in the past (such as bankruptcy, or consumer proposal), it may be impossible to get into a mortgage at a good interest rate, even if you have corrected your errors and are working to improve your financial future.
RTO Partners believes in 2nd chances – we work with people that may not qualify for bank financing or have the down payment needed to buy a home. Instead, we have worked out a program that will allow them to move into a home and give them 2-3 years of financial education to rent their homes toward ownership.
Building strong communities means strengthening neighborhoods. And, one of the best ways to strengthen a neighborhood is to make sure its residents have safe, decent and affordable housing for people who live and work in the area.
In addition, we have a wonderful opportunity that will also be of interest to investors looking for a feel-good investment with solid returns. Our honesty and transparency allow both prospective tenants and investors to work with us with confidence.
- What is the monthly rent going to be?
- How Am I Protected?
- What Are The Renters’ Responsibilities?
- In What Areas Is This Program Available?
- If I’m A Real Estate Professional, Can I Work With RTO Partners?
- What’s The Return On Investment?
- What Are The Investors’ Responsibilities?
- What Are The Risks And How Am I Protected?
- Why is Canada a Superior Opportunity For Real Estate Investors?
- Taxes – HST, GST and capital gains
Frequently Asked Questions For BUYERS
How much is the monthly rent?
Rent is based upon 2 things: a “base” (market average) rent + a monthly credit that is added to the rent to ensure that you (the tenant) have built a down payment of usually about 10% when your lease ends and it is time for you to buy the home. We are flexible in that we can look at past bankrupt or consumer proposal clients, as well as imperfect credit histories.
Will You Really Give Me Personal Help?
We respond to investor and tenant inquiries within 2 hours whenever possible. We make detailed notes about all of the tenants and investors we speak with. And we follow up to make sure things are moving along, whether we’re working with you directly or if we’ve recruited one of our partners to provide you services.
How Am I Protected?
Our tenants will work in person with our realtor partners to understand everything before making any kind of formal commitment.
As a condition of leasing the new homes, residents agree to work with RTO Partners and its partners to repair any credit issues, in order to boost their chances of qualifying for a traditional mortgage within 3 years.
Mortgage brokers are bound by the code of mortgage broker ethics and laws in Canada
Ontario Real Estate Association – laws, rules, ethics
You are encouraged to review all paperwork with a lawyer.
Responsibilities Of Tenants
Our tenants will visit homes and sit down with our management to understand their responsibilities, before making any commitments on paper. These of course include (but are not limited to) the responsibilities of a typical Canadian in a house lease agreement.
What Areas Are Available For Future Home Owners?
We started out in an area outside the GTA (Toronto), but quickly found partners that are letting us help clients in other parts of Ontario. We have also been in talks with people who are interested in helping us expand outside of Ontario. We are being very careful about our expansion because we need to ensure a consistent level of service across the country.
It is generally difficult for us to rent to own deals in areas with the highest pricing. The “sweet spots” are areas where small to medium houses cost $195,000 to $300,000.
Can Mortgage Agents And Realtors Work With RTO Partners?
Yes. If you have clients that you cannot finance to buy a home due to bad credit or not enough down payment, you can refer those clients to us and we will see if their income and down payment qualify them to work with us.
Frequently Asked Questions For INVESTORS
Return On Investment
For the majority of projects we strive to deliver you anywhere from 20% to 35% a year.
Responsibilities For Investors
As an investor you are also a landlord, and are responsible for collecting rent, and other duties as outlined in your tenant’s lease agreement. You may choose a local property manager to manage this for you, and we will recommend one to you if needed.
Your tenant is responsible for costs and labor involved in lawn care, snow removal and other general maintenance.
Risks, And How Investors Are Protected
- When you buy in Canada you can investigate opportunities, buy properties and visit them without expensive and time-consuming trips
- Safer than speculation in American foreclosures and foreign development projects
- Easier property management
You are protected by real estate law, mortgage law, etc., similar to the protections afforded tenants listed above.
If a tenant does not qualify to get their own mortgage at the end of their lease, you may extend their lease, sell the property, rent it to a different family, or whatever other action you may choose as a home owner. If the tenants leave without buying the house, you keep the entirety of their down payment and monthly credits (which protects you against market dips, new tenant location costs, carrying costs etc.).
HST and GST issues for real estate investors.
Investing profits are subject to capital gains tax.
Good news – home prices in Canada are still strong
The following chart shows, from the 3rd quarter of 2010 to the 3rd quarter of 2011, the average home price percentage change for 10 countries. Canada comes out on top. This is good news for Canadians because very few mortgages in Canada are “underwater”, where the mortgage balance is greater than the fair market value (FMV). It’s also a good thing for Canadian real estate investors to know when they’re contemplating investing in American foreclosures and would like to earn money “in their own backyard” instead.
Below is a chart showing multi-year average house price in 9 countries.