Rent-to-own contract should address many issues

Q. I have always rented. The owner of this new house has offered to let me rent to own. I have a basic idea of what is involved: appraisals, deed searches, inspections and closing cost. How do you set a selling price without an appraisal? And how can I find out the market price?Also, I need to know for sure that there are no back taxes or second mortgages or liens against the property before I make this commitment.A. You estimate how much the house is worth by looking at nearby houses for sale and researching recent sales in that neighborhood. Look at sites like Zillow.com for starters.You are worried about the right things. And how much of your rent will be credited toward your eventual purchase price? Who will hold it? And under what circumstances might it be returned or forfeited?Who will be responsible for repairs while you're in the renting stage? Who will pay taxes and insurance? If the tenant/buyer does, a contract before April 30 may qualify you for a first-time homebuyer tax credit of up to $8,000, even though there's not yet any transfer of ownership.You need a lawyer who specializes in real estate to advise you and write a contract that protects your interests.Q. My husband and I have divorced and our mortgage loan is in my name. He still lives in the property and I have moved. How can he assume the loan, and how can I remove my name and responsibility from it?A. You don't say who currently owns the house at this point. If you are still on the title, there's not much you can do.But if your ex is the sole owner and it's an FHA or VA mortgage, he may qualify to assume entire responsibility, depending on his financial situation. Even with a different type of mortgage, it's sometimes possible. Inquire of the lender.Otherwise, the only solution is for him to refinance - get a new loan in his name and pay off the one for which you are still responsible.If that can't be done, you'll remain personally liable for the whole amount, and it will continue to show up as a debt on your credit record. Too bad you didn't get this settled during the divorce proceedings, along with everything else.Q. I wanted to ask your opinion of a home-improvement project that the economy has thrown into a different light.I've seen numerous discussions of the return-on-investment in adding a bathroom to a house. We own a three- or four-bedroom, one-bath house - a small two-story of just over 1,400 square feet. The upstairs has a walk-in closet that could be a nice master bath. That is the project we are considering.Here's how my question involves cost versus return. We are fortunate in that we bought the house years ago for only $107,000, and current worth from different sources places it around $180,000. In that we will already take good equity from this house when we move in two or three years, would this bath addition with estimates of $6,000 to 7,000 be worthwhile?I've been given one opinion to not spend more than $4,000 on such a project, as that is about the price it would add to the house. Houses around here seem to sell well with just a single bath, but I'm certain a second can't hurt. I'm just concerned what return I'd get versus the cost.A. Of course, a second bath would make your home more attractive to future buyers, but remember that no matter how nice the property, people will pay only so much to live on a given street. Buyers with more to spend want to live somewhere else. People are just like that.Those who intend to remain in a house for some years can make improvements for their own satisfaction, without regarding them strictly as investments. But if you intend to move within a few years and you can't face the thought of losing a few thousand dollars on your improvement, think twice.Q. What should you do when you have already signed a contract and need some additional documents from the seller for the loan, but they refuse to communicate with you?A. Turn the problem over to a professional. You don't say if real estate brokers are involved. If not, hire a broker to act for you or get a real estate lawyer on it.bull; Edith Lank will respond to any questions sent to 240 Hemingway Drive, Rochester, N.Y. 14620 (please include a stamped return envelope), or readers may e-mail her at ehlank@aol.com.2010, Creators Syndicate Inc.