MN Rent To Own


Rent to own or lease Option- arrangement, the seller is giving you the right – at some point in the future – to buy the house at a price that is agreed upon today.

Usually, a portion of your rent over a specified lease period goes toward your eventual down payment. Typically, a Minnesota tenant would pay slightly above-market rent over the lease period, usually from one to Five years, for the right to enter into this arrangement. It”s also common for the tenant in Minnesota or western Wisconsin to pay a fee in “option money,” or for the privilege of having the option.

For example, if a house in Minnesota would typically rent for $1,500, you might be asked to pay $1,800 per month, a portion of which — say $300 — would be credited to your eventual down payment, depending on the contract you work out. Such an option usually expires at the end of the lease. In other words you must exercise the option before the lease expires.

But be careful. In some lease-purchase agreements, you are contractually obliged to buy at the end of the lease. Minnesota Sellers and agents now often use the two terms interchangeably. But whatever name they attach to the arrangement, make sure you have the option.

The arrangement gives you more time to think about the deal plus provides a built-in structure to save for your down payment. It also allows you to discover any flaws in the home that may not have been detectable on an inspection and to get a feel for the neighborhood without committing to a long-term mortgage.

In Minnesota areas where Real Estate values are quickly rising, locking in a purchase price on the day you sign the initial rent-to-own contract could be very profitable for you. If appreciation is significant during your lease portion, You will come out way ahead. The problem with this theory is that good lease-to-own deals are generally scarce in hot sellers markets. If a seller sees rapid appreciation, there is no motivation to agree to sell at today’s price a year -five years later. Only Minnesota Owners who’ve had their properties on the market a while, or had to move away quickly and are struggling with two house payments, are likely to agree to a lease-purchase arrangement.

Another potential disadvantage is that you may be obligated to tend to repairs and maintenance throughout your lease stage, instead of the landlord. Under most lease-to-buy contracts, any money or sweat equity you put into major improvements will not be reimbursed in the event you eventually opt out.

Where do you find Minnesota or Western Wisconsin rent-to-buys? Most Real Estate sales agents and Real Estate Rental Agents have listings. Also, try an Internet search under ” MN rent-to-own homes ” followed by your city’s name-Neighborhood-school district.Or, if you see a rental home that you really like, just ask the leasing agent if the owner might be agreeable to a Mn Rent-to-own arrangement.

Contract for deed homes –in Wisconsin there are know as land contracts option to puchase agreements.

Mn home buyers need around 10% down of the sale price to enter into a contract for deed.

Rent to own the home renter will need around 5% down usually for the sellers to offer rent to buy financing.

Contract for deed Real Estate can be tricky make sure you use a knowledgeable Real Estate Broker when Buying or selling a house on a cd.

Related Rent to Own links




Steve Vennemann (651-334-8312) BROKER



If you want to own a home verses renting or rent to own-leasing then cd is the best option.


Bennefits of contract for deed buyers

  • Tax bennefits write off the cd interest on your tax returns.
  • Make the house your own painting-adding a fence ect-pets ok
  • Build equity verses paying off some elses mortgage.
  • Save $1000 on closing costs- NO origination fees-lender fees.
  • NO BANK Qualifying
Contract for deed is a great alternative financing program. If you cant get a mortgage why would you want to keep renting if you have money to put down on a home. Alot of people with good credit are also buying homes on a cd due to FHA mortgage insurance. The Mortgage insurance payment on a $200,000 can be $250 amonth that is alot of money for 30 years. Alot of buyers refinance into a conventional mortgage towards the end of the 5th year of the contract. The rental market is really expensive right now it costs more to rent a home in the twin cities metro area's than it costs to buy one. That is something to think about.

Sellers cd advantages 

Cash flow-steady stream of income. Sellers can make a better return on thier money verses the bank account-charge a higher rate than a mortgage. Easy to cancel the land contract- In Minnesota the law states the seller can "rescind-cancel" the contract in 60 days. Experience does matter and remember it doesn't cost you anything to use when you purchase your dream lake home or Lake Property. We have lake homes contract for deed.

***Remember there is alot to know when buying or selling a Property with contract for deed terms. We can take the stress out of researching properties for you.***

Western Minnesota owner financed homes-Eastern Minnesota owner financed homes-Southern Minnesota owner financed homes-Northern Minnesota owner financed homes.



  • When buying or selling a property contract for deed we recommend using BoardWalk Premier Realty INC
  • Always use a title company when buying a cd house or selling. The reason is the title company or law office can provide both parties with a title search and if the buyer chooses the buyer may purchase title insurance we recommend the buyer purchase this insurance to protect themselves against and liens-assessments ect.
  • Some people think contract for deeds are just for people with bad credit that is not the case. A lot of people buy c4d properties with good credit they don’t want to leverage all their credit or self employed or relocation haven’t been at a job long enough to get a mortgage. Another reason is FHA mortgage insurance is really expensive they keep raising the fees so now buyers are choosing owner financing and refinancing in to a conventional loan or selling the house in a few years.
  • MN homes contract for deed can be the perfect solution for buyers looking to have a home but cannot get financing.
  • Contract for deeds is NOT the same as rent to own-leasing-carry back mortgage. Totally different.
  • Buyers will want to know if they can sell the cd with out refinancing it. Letting another buyer assume the contract is a great item to have for the buyer. That is something we put in all our land contracts
  • Buyers will want home owners insurance-decide if they want to escrow taxes or pay seller directly.
  • Always get a home inspection.


Make sure buyers open 2-3 accounts and pay on time monthly. Do not go over 25% of the credit limit. Banks will want 1-2 years of payments on time. If you cannot get a credit card there are cards you can put money down and they will give you a card and you can pay on it. The main thing is to get credit and someone reporting to your credit bureau.

  • Sellers have the right to cancel a MN contract for deed 60 days after default seek legal advice on that. Buyer may sign back the contract with a quit claim deed. Seek legal advice on that also.
Homestead sometimes when you buy a home it is non home stead the buyer can call the county or city the property is in and see what the taxes would be once it is homestead. Record the contract for deed it is the law in MN but if you close at a title company or law office they will do it for you.  


We work with installment contracts-purchase money mortgages daily. There is a lot to know when drafting the purchase agreement and land contract.

  • Remember with RENT TO OWN if you DO NOT exercise your option to buy the property you will loose out on down payment-and any payments you have made to the owner. Make sure you DO NOT Make any repairs to the house until you refinance it because if you don’t buy it you loose out on all of the repairs you put into the house.
The buyer has the right to occupy claim homestead status. Most of the time the buyer gets possession at closing unless stated in purchase agreement. If the buyer defaults on the contract for deed the seller may cancel the contract to reclaim the property. In Minnesota the seller with have to serve buyer a cancelation from a third party and proceed at court.

Selling a home in todays real estate market.

2014 Market Update, year-over-year median home prices have been on the rise for two straight years in the 13-county metro area.  


Inventory remains near a 10-year low, and year-over-year double digit price increases are almost becoming standard. These are two sure signs of a sellers’ market and if they both continue, smart sellers will be able to entice buyers for their properties at a fair price quite