Rent to Own Purchase Contract

[Chris Soltan]

Hello, I’m interested in purchasing a home in the Gallatin County (Bozeman, MT) area. There is a 4bd 2.5 bath ~1600sf home for sale. It’s been on the market over a month and I believe is a little overpriced given the current interest rates at the moment. I’m interested in proposing a rent to own deal to the homeowner. I’d be asking to rent the home for 2-3yrs and use that towards paying down a proposed purchased price and execute on a home loan if/when interest rates come down. I’d also put down 3-5% of the loan amount at the time of purchase. We plan to have a roommate to help cover some of the mortgage in the near term. I’m likely to receive a promotion at work in the next year which comes with a higher salary. My wife also works and we have no debt. Assuming the owner would accept the deal, we would look to stay in the home 3-5yrs and then use equity to move into a more desirable location. We own another home, going on 2yrs, we are currently renting and it is breaking even. I think with this deal we would look at coming into the home with equity and a lower loan amount if interest rates go down. I’m new to real estate investing and curious what I may be overlooking proposing this deal. Any thoughts?