Rent to Own

Rent to own is a process by which a renter leases the property and is given the option to purchase it after a certain period. This is different from the regular rent because the rate you will be paying is higher. However, the portion of your monthly rent will go to your credit which will be used when you finally purchase the property. And, in order to enjoy such option, you will need to pay a fee called option consideration.

There are other differences. When you pay the regular rent, your money will be gone forever. Unlike in the rent-to-own, since part of the payment is credited for the purchase of the property. This is like saving money for the down payment of your future purchase. The landlord does not have plans of selling the property in regular renting of property, whereas in the rent-to-own, the landlord has all the intention of selling the house. In addition to that, the landlord will have lesser responsibility. Since the occupant is considered as part owner of the property, he is responsible for some of its maintenance.

It is best that you consult a real estate agent first or a financial counselor before you decide to get a rent-to-own property, make sure that you consider important thing carefully. Be sure that you will be able to purchase the house because all your initial payment will go to waste if you fail.