Deed on Redemption of Ground Rent
Pay the ground rent to the land owner and enjoy the ground space
Ground rent is paid to the landowner on which the building is constructed. This type of Deed on Redemption of Ground Rent is very popular in certain parts of the world. Every year the homeowner has to pay a small amount to the owner of the land (ground) as a rent. Ideally, the owner of the ground rents may be individuals, companies or banks. However, in order to get the rent on time, you and the homeowner has to prepare a ground rent redemption deed. This Deed on Redemption of Ground Rent has to be signed by both to avoid disputes in the future. Interestingly, the ground owner will just come to collect the rent and you as a homeowner, should take care of your ground, i.e. cleaning, axing the trees in the lawn, gushing out the snow, etc. Generally, the amount to be paid yearly will be clearly mentioned in the ground rent lease. The payment has to be made twice a year as mentioned in the lease and failing to pay the ground rent on time would push the homeowner to face legal issues. Usually, the ground rent is being paid by the mortgage company by taking from your escrow account.
Ideally, people would like to redeem the ground rent. The ground whose lease has been renewable forever is being redeemable. Also, when the owner of the home purchases the ground in which they have their home, then they do not need to pay this ground rent to the land owner. The money that you can redeem on the ground rent totally relies on the ground rent, lease and the laws of your state. However, if there is any redemption price mentioned in the lease, then you need to pay the same otherwise, you would need to pay the ground rent that is fixed as a capitalization rate by the state where you are dwelling.
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