How Does Part Purchase Work?
Simple Steps…
1. Get pre-qualified for a budget and find your new home…
Our pre-qualification process is similar to a mortgage application.
If you meet our application criteria a home budget will be agreed with you.
You can then select any good quality house for sale within your budget.
An Appraisal and Home Inspection Report will confirm the property meets our property criteria.
Make an offer - as a cash buyer - and agree the home purchase with us and the seller.
2. We buy the home and make it easy…
Using our access to large scale capital we buy the home with you.
Using your down payment savings you immediately purchase 10% to 35% of the home and sign a long-term agreement between us.
This agreement gives you security and the freedom to live as you wish, the right to purchase more of your home at any time and the obligation to pay bills, property taxes and to look after your home (just like a mortgage).
On completion, you move in and start enjoying your new home…
3. Enjoy your new home and continue your home purchase journey…
You pay an initial monthly rent of 5.5% pa linked to the value you didn’t purchase.
Just like a mortgage, you are responsible for all property costs including insurance, taxes and HOA Dues.
Affordable monthly payments means continued savings to purchase more of your home.
Annual rent increases are set at 3%, meaning they remain affordable over the long term.
Every 5 Years there is a check to inflation. If inflation over the 5 Year period has been more than the 3% annual increases then then your rent will increase to match inflation. Your rent will go up by 3% each year until the next 5 year check to inflation.
Using our dedicated app you can see your purchase level, the value of your equity the price to purchase more of your home and your reduced rent if you decide to buy.
The price you pay to purchase more is linked to the market value at the time – no complex options or predetermined pricing.
You can even freeze the price of an additional 10% purchase in your home during the first 5 years by making slightly higher monthly payments.
When you purchase additional parts of your home your rent goes down proportionately
4. Over time your equity grows and you progress to full purchase…
Purchasing in small amounts, whenever you can afford, you build equity over time and can move to full purchase with a mortgage later if you want when you have enough equity.
Once you’ve purchased 100%, the long-term agreement falls away… Your home is all yours!
Key Terms And Conditions
Your Name On A Registered Title
The Part Purchase process creates an new registered and insured Leasehold Title in your name. Which can be passed on to your heirs.
Part Purchase America’s funders will formally recognize your rights of non-disturbance under the 99 Year lease.
Ultra long-term agreement
Your agreement with Part Purchase America is a s long as we could make it - 99 Years.
This gives you and your family long term security to live in your home.
The agreement can be terminated at any time by simply selling your home.
Full repairing and insuring obligations
Just like a mortgage you are responsible for the maintenance and insurance of your home.
Part Purchase America will insure your buildings and recharge the cost.
Clear, affordable annual rent increases
Each year your rent will go up by 3% - guaranteed.
Every 5 years we will check your rent to inflation (CPI-U) bring it in line if inflation has been more than 3% pa.
Make additional Part Purchases to own 100%
You can make additional Part Purchases at any time in any amount.
Each Part Purchase occurs at the higher of original cost or current fair market value.
Once at 100% the long-term agreement ends and your home including the fee title is all yours.
Make Home Improvements
As part of the long-term agreement you have the right to make home improvements.
You can make minor non-structural improvements (e.g. paint the walls, change appliances) when ever you want.
Larger improvements will need to be approved but you will get to keep 100% of investments such as extensions.
Your investment is at risk if you default the agreement
Just like a mortgage, your investment and value entitlement in your home may be at risk if fail to make your monthly payments or breach the long-term agreement with Part Purchase America.
We undertake to treat all customers fairly and provide support in times of genuine difficulty where possible.
