Profile picture for Mellady

Hello; I've been renting for the past 17 years in the Bronx and I'm looking for a rent to own home.

  • August 04 2013 - Bronx
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Answers (2)

Profile picture for wetdawgs
While the theoretical concept of rent to own may seem attractive, some of the realities are considerably less so.

Owners who will consider rent to own are very rare, so it will cut down your options for properties considerably.   I consider it much smarter to spend a year or two working on improving your credit and and saving up a good down payment.   Yeah, it is tough to move but it even tougher to lose a lot of money attempting to buy.

Some features of rent to own:

1.  Down payment required - often substantial (say 10% or 20% or more) and is non-refundable if the potential buyer doesn't purchase.

2.  Monthly rental is above fair market rent, with the only amount going to purchase is the amount above the fair market rent.  This is also not refundable.

3.  If not qualified for financing at the agreed upon  time and price, then you lose everything. 

4.  The price is agreed upon at the beginning of the contract, and who knows where house prices are going.

5.  You still depend on the owner to pay their mortgage.   If they fail, you lose.

If you do get involved in this, please involve an attorney in the contract.
  • August 04 2013
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Rent to own programs are great for people who cannot qualify for bank financing. The best places I have found them is online at Craigslist or in a local newspaper, often times there are rentals and they may also suggest a rent to own option. Sometimes a rental can also become a rent to own, so it never hurts to ask. Property Managers may be a good place to ask as well, since they manage rental properties for owners. They may know of an owner who wants to get out of the rental business.

Best of luck to you,
Liz
  • August 04 2013
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