At least one to two times weekly, people call my office and ask if we have any rent to own homes. Usually these people assume that they cannot buy a home for whatever reason.... which is sometimes not true.
When you rent to own your home you must ask yourself, how long will I live in this house? The average length of stay is around 6 - 10 years. However, it might take 30 years to pay off a mortgage.
What happens when you move out of your rent to own home? If you haven't fulfilled the contract to own the home, nothing happens that's positive for you, because the home doesn't belong to you. Technically speaking, you still have a landlord until you fulfill the terms of the contract.
Let's say you do stay for years and your contract states that you can now buy the home. If you cannot qualify for a mortgage, you've just lost all that money that you've paid into that home for rent and upkeep.
What happens if the owner decides to stop paying the mortgage company? The home will then be foreclosed, which again means you've just lost all that money that you've paid into that home for rent & upkeep.
Can you sue to recover the money that you put into the home? Sure, you can sue someone for anything. But that doesn't mean you'll win or get your due process.
Rent to own homes are good for one thing, and that's the person who owns the home. There's serious, yet un-needed risks to consider as a home buyer. You have to decide if this is the best way to go for you.
- You Do NOT Need 20% Down Payment To Buy A Home
- You Do NOT Need 10% Down Payment To Buy A Home
Are you sure that you cannot qualify for a mortgage?
It's always a good idea to become preapproved for a mortgage, rather than guessing if you'll qualify for a mortgage.
If you don't qualify, you can then get free credit guidance that will help you repair what's needed to buy a home.
Also know that banks are required to follow strict guidelines for mortgage pre-approval, that other mortgage companies may not have to follow. In addition, not all mortgage companies and banks offer the same programs. That's why it's best to shop around.
Contact the Home Sale Power team. We're happy to help you find a mortgage company that:
- Is right for you
- Holds less risk
- Will help you save money