Buying a home from your landlord: a 5-step “how-to” that’ll save you big

Stepping up from renting to owning is exciting—but what about that home purchase that lies in the way? Here’s how to make it a snap!

Key takeaways:

  • Knowing what price to offer is key—luckily, there are several resources that can help
  • Save time and energy down the road by getting pre-approved before making an offer
  • Communicate your intentions to your landlord and make sure you're on the same page
  • Easily make your own offer and save thousands in commissions with Home Savi
  • Manage your entire transaction and close like a pro with our Transaction Dashboard

Buying the home you’re living in is one of the most straightforward real estate purchases you can make. You know the home and most of the issues it might have, so why pay an agent a 2.5–3% commission for work they don’t have to do? Sure, you could hire a real estate lawyer to write up your paperwork, but that would still run you 3–5 thousand dollars at least. Home Savi gives you all the tools and knowledge you need to get the deal done and save tens of thousands at the same time. Here's how to get going.

Step 1) Get an idea of what the home is worth

Begin by researching your local market online. These days, several sites provide instant value estimates. While these are a good place to start, know that they’re not always perfect. Do your own competitive market analysis (CMA) to come up with a fair, but competitive, offer price. HouseCanary could help.

Step 2) Get pre-approved for a mortgage

Just because you know the seller doesn't mean they’re not looking for a well-prepared buyer. Getting pre-approved shows that you’re serious about buying and that you have your financial ducks in a row. It’ll make your offer stand out from the crowd and also help you set a budget. Speaking of getting things in a row—if you're receiving financial help from your family, the earlier you start the conversation, the better.

Protip: Because getting pre-approved usually requires a “hard pull” on your credit, getting pre-approved too many times can end up hurting your credit score. So, be sure you’re actively looking to buy when shopping around for a mortgage.

Step 3) Have a conversation with your landlord

You may be ready to buy, but your landlord might not be on the same page. Talk to your landlord (pre-approval in hand) and ask if they’d be willing to consider you as a buyer. If your landlord was the one who approached you about selling their home, try and investigate why they want to sell. Are property taxes increasing quickly? Are they relocating and don’t want to manage the property from far away? Drilling down and finding out their motive could gain you some leverage or even save you from a messy situation.

Step 4) Make an offer through Home Savi

With Home Savi, making an offer couldn’t be any easier. You set your own terms (offer price, days to close, etc.) and can then electronically sign and send your offer directly to your landlord. Worried about how counter offers will work? Don’t. That’s all handled through the platform as well. See what else you can expect as a Home Savi user.

Oh, and we almost forgot the mention the best part! When you buy with Home Savi, you get to keep the commission that would have otherwise gone to a buyer’s agent. That’s right—with Home Savi, you can save 2.5–3% on your purchase. Just to put that in perspective, on a $750,000 home, that’s a savings of more than $18,000. What would you do with an extra $18,000? Buy new furniture? Take a few vacations? Pay off closing costs? It’s all up to you!

Step 5) Close on your new home

So you submitted your offer and got it accepted—nice going! But you’re not done yet; you still have to close to make things official. Good thing Home Savi’s got you covered on that too. With our Transaction Dashboard, you’ll be able to see and complete all of your outstanding tasks, request repairs/credits and easily manage your entire transaction like the real estate pro you are. You’ll probably have a few questions, which is why we’re always available to help if anything comes up. It’s really that easy.

Meet Steve: a real-life Home Savi success story

Steve’s story starts out like many of yours will. He’d been renting a home for two years and wanted to buy. So when his landlord told him that she was planning to sell the home instead of renewing the lease, he decided to seize the opportunity and take a shot at the American Dream.

Through their conversations, Steve found out that his landlord wanted to list the home for sale for $750,000, which was higher than his budget. But (since Steve knew about Home Savi) he realized that he could get a deal done without any agents involved (on either side) and save himself and his landlord a ton of money in commissions. Because there would be no commissions to pay out ($35,000+), Steve was able to offer a lower price, somewhere in the neighborhood of $715,000, and buy his new home (see below)!

Steve's House

Home Savi helped Steve create a professional, legally binding purchase agreement with joint escrow instructions that covered him in case anything major came up during inspections. Once his offer was accepted, Home Savi's Transaction Dashboard and support kept him organized, made requesting repairs easy, gave him service provider suggestions and even helped him close ahead of schedule.

With nearly $35,000 in savings, Steve was able to buy his dream home, stay within his budget and have some cash left over for remodeling projects.

Learn about representing yourself when buying and how commissions work. Want to see just how easy using Home Savi, the first true DIY home buying platform, can be? Sign up and get started for free today.

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