How Do Rent-to-Own Homes Work?

Answer 1

The whole rent-to-own system of buying a house may seem a little confusing, but it is actually simple and intuitive. Rent-to-own or lease-to-own homes are similar to a car lease. Simply read this guide to understand how exactly the rent-to-own process works.

Why rent-to-own?

Rent-to-own is perfect for a family that can not afford the down payment to buy a house. Rather than buying the house a family pays rent each month. This is perfect for a family that does not have the money saved up to begin buying a home right away.

Rent-to-own is the perfect option when a family does not have to money available to go out and begin buying a home. How rent-to-own works.

When someone buys a house, they have to put forth a down payment to show that they can pay for the house. Rent-to-own works by allowing families to rent a home in hopes of one day having the money to buy the home. Each month that a family pays rent on a rent to own home, part of the money goes toward the owner as income, while another part goes toward an account that is saved. After a set period of time, the family has enough money saved up to make the down payment on the home and to begin buying the home. While this is a lot more complicated than beginning to buy a home right away, this option allows families that do not have enough money for a down payment to begin buying a home. The period for the down payment to gather is usually somewhere around three years.

Rent-to-own is a great option for buying a home that allows families that usually do not have the means to own a home to find a place they can one day buy. Rent-to-own is a simple process that is actually much like leasing a car. In the long run, a family can buy their home.