RentToOwn-HouseFinder.com
Rent-to-own homes?
How do rent-to-own homes work? The house next to my sister recently sold and whoever bought it now has a "Rent-To-Own" sign in front of it. The signs says something about people with credit problems are okay. Don't they eventually have to get a regular mortgage? I thought the mortgage industry was cracking down on these "creative" mortgages. How much better is it financially to rent-to-own instead of just buying a house? Just curious ...
Public Comments
- Here it works like this: Person A needs a home they see a rent to own by Person B Person B tells them they can put down a sum of money with an option in an agree'd time period to get a mortgage and begin payments on the home. If within those 2 years Person A is late on a payment , they are in violation of the contract and they can lose that initial deposit or they decide they just don't want the home and Person B gets the lump sum and keeps the house. They prefer people with bad credit because the possibility of them ever being able to get a mortgage to own the home is slim and they can just keep cycling in people and getting the extra lump sum every year or couple of years. This may not be exact how it works everywhere but that's how it is around here. Anytime you can afford to own your home from day one, the better. With rent to own, 2 years of leasing is two years of payments that could have gone to towards a 30 year mortgage.
