When deciding to buy a storage building, customers often ask what payment options are available for them. This is a great question, especially when not all payment options work for every customer for different reasons.
So let’s take a look at what payment options you have when buying a storage building!
Pay up front
The first option is the most simple and best option. Pay the building off up front. At Bunce Buildings we take cash, checks, money orders, cashier’s checks, debit cards, and we also accept credit cards for a 3% credit card processing fee. When you pay your building off up front you don’t have to worry about monthly payments and interest, which in turn keeps the total cost of your building lower than if you were to finance or rent-to-own.
Financing is an option that many Bunce Buildings customers choose. When a customer decides to finance they will fill out a credit application for a line of credit. A customer who decides to finance will pay a monthly payment that includes interest, which is dependent upon their credit score. Monthly payments vary based on the price of the building, their approved interest rate, and the length of the financing agreement. We usually offer interest rates between 14%-18% over 2-5 years. When a customer finances their building they will own the building from the beginning.
The third and final payment option Bunce Buildings offers our customers is Rent To Own (RTO). RTO DOES NOT require a credit check, and is an option for customers buying a storage building that cannot finance or choose not to finance for whatever reason.
Customers who chooses to go the RTO route will make monthly payments that are determined by the price of their building and the length of the RTO agreement. We use a multiplier to determine the monthly payments. For instance, if a customer decides to do Rent To Own for 36 months we multiply the price of their building by a 1.67 multiplier and divide that number by 36 to get their monthly payments.
Example: Let’s say a customer is buying a storage building that is $4,000 before taxes and does RTO over 36 months.
$4,000 X 1.67 = $6,680
$6,680 / 36 = $185.56
The customer’s monthly payment would be $185.56 before taxes.
If the customer pays more than their minimum payments each month the extra money paid would go towards the cost of the building, and not the Rent To Own payment, which will help pay off the building faster. Each month half the monthly payment goes towards building ownership (equity) so that the total amount owed each month is reduced by half of the monthly payment. So as in our example above of a monthly payment of $185.56, half that amount, $92.78, will be applied towards ownership of the building and the other half towards the rent for that building. And if a customer desires to pay off the RTO agreement early he or she will get credit for the equity built up and can subtract that amount from the purchase price of the building to get the payoff amount. Plus, any RTO customer may payoff the RTO agreement early with NO pre-payment penalty!