If there is another thread about this, I apologize in advance...


Been house hunting lately and have seen a lot of places that are listed as rent to own. I haven't done a lot of research on this but was wondering if anyone has gone this route and what the pro/cons to this are.

Thanks

 

I suspect that if you're actually wanting to own the home, then Rent to Own isn't the most efficient way to do it. However, if you can't afford the down payment, or if your credit puts you in a position where you'd get a really crappy interest rate, then you might have to consider the Rent to Own option. In the end, I expect you'd pay more with a RTO option than just buying it outright.
Look at the numbers. They'll tell you the pros/cons.

Be sure & read the fine print.

 

i am going to the movies in a few minutes so I will post more when I get back..... most of the time you will want to stay clear of a RENT-TO-OWN!

I will post more when I get back...

 

back......

Rent to own in general is for losers....unfort..... it is for people who cannot get good financing or have bad credit and need a year or two to improve it.

Most of the local places are recent rehabs as well..... which, depending on the contractor / owner could be really slapped together like crap.

I have sold 4-5 houses Rent to own. Since I have a decent paying full time job, I do not try to rip people off quite like the normal landlord / flipper / etc.. I always buy a 1 year warranty for the tenant and I pay for the first deductible if they use it. I also let them bring their friends, parents, etc... in to check out the houses first. I give them 18 months to get their own financing with a $2k nonrefundable deposit. I set the price at the time we sign the contract, so in 18 months they keep all of the appreciation (assuming they buy the house).

i have had okay luck. Lots of people never improve their credit and just turn into a pain in the ass after 18 months.

I have seen lots of other Rent To Own dickholes who charge way more than me for a property that is in way worse shape. i have no idea how they justify it or get financing but that is on them.

buyer beware....goodluck...

 

well, at least with rent to own, SOMETHING is going toward principal

but scot is right. if you want to buy the house buy it. rent to own winds up costing you much, much, much more because only a low % of the rent goes toward any potential equity. with a down payment it is 100%.

scot's right about the unscrupulous, too. rent-to-owners generally have few options, so they have to submit to whatever a rent-to-own seller demands.

 

^ I forgot that I do credit a small amount of $ each month ($50-100) back towards the purchase price.

one neat thing about "rent to own" here in Harrisburg is that the City of Harrisburg offers a $10k grant for any tenant who then purchases a house they have "rented" for over 1 year. A decent house in a decent part of town is about $80k right now. so $10k is a hell of a nice gift on that size purchase, so that is one big advantage to doing it here. Unfort like I mentioned before, the quality of the landlord is usually pretty low.