What should I know about rent to own?

Question

We are looking to move in the near future. I'm tired of renting but we are not ready to buy yet. We have some medical bills that need to be taken care of first. So we thought that rent to own may be a good option, but I do not know the first thing about it. Can someone let me know all of the essentials? And please speak to me as if I were a small child. I literally know nothing. We have only rented in the past. I really appreciate any help!

Uh girlyinny could you be a little more judgmental? You know nothing about me or my situation. Time to clime down off of the high horse missy.

Answer 1

Why don't people simply answer the question at hand sans the personal comments?

There are many "legitimate" lease/option, rent to own opportunites. It would be best to work with a licensed Realtor, to ensure that it is a good deal for you and not slanted to benefit the seller only.

You do not pay the Realtor anything to work with you.

They will take time to explain everything to you and afford you the due diligence time necessary to select the right property. Since you've admitted to knowing nothing at all - please secure representation for yourselves.

Begin with talking to family & friends in your area, by asking for a referral for a Realtor whom they have worked with and trust.

The Realtor can identify these properties/situations, much faster than you will be able to, after you've described your needs.

Best of luck to you in realizing your home ownership goals!! You can do it!

Answer 2

ok, rent to own would make your financer big bucks, cause they get to charge you intrest.
there are two types of intrest. the intrest rate you are paying every single month thats attached to your payment, make sure you dont let someone charge you a higher intrest rate than a bank. point blank. banks will GIVE out mortgage loans at 6%-9% if you have bad credit.
this will help
say you buy a house @ 200,000 right.
you get to choose the lenght of the loan, 15 or 30 years.
(30 is average)
now say your intrest rate is 6%
this makes your monthly payment $1,199.10
watch this... 1199.10 X's 12 months a year=14,389.20
now 14,389.20 X's 30 years=$431,676
ahha, that there shows they have made DOUBLE off you in 30 years (big business) so banks will lend to ANYONE! they make money when they forclose when you dont make your payments.
now the second intrest is APR this is like chineese, that not many people even banks can explain clearly
there are a few other things to know about the home buying, check the taxes too. last years taxes for someone in that area, maybe 400-5,000 i dont know, cause i dont know where you live, that can be devided into 12 months too, add that to the mortgage payment, now add in homeowners insurance, 400-4,000 (again, ii dont know where you are) that into 12 and add that to your mortgage payment.
LASTLY
I GOT SCREWED WITH A RENT TO OWN.
the wrote it on the wrong paper work. so, if you do this with a private mortgage make sure everything is transfered, THE DEED you better be named ON THE DEED and the seller listed as mortgagee.
MAKE SURE YOU GO TO A CLOSING
MAKE SURE YOU DO A TITLE SEARCH
MAKE SURE YOU USE A TITLE COMPANY OR A LAWYER
ok.
buying a home is a great investment. just be careful
and if you change you mind about rent to own that would be better, use a mortgage broker, they wont let you get screwed, or you wont go to closing, and they can answer all your questions

Answer 3

When doing a rent to own, do it as a land contract purchase. Make sure part of your payment goes toward the actual purchase of the house, and make sure you are put on title at the closing. Also make sure you make your payments with a cheque, and get a copy of the front and back once it has been deposited. After 6-12 months, a lender will treat this as a refi, and not a purchase, and make it a lot easier to do the loan. Spending $250 bucks on a lawyer isn't a bad idea either.

Answer 4

Rent-to-own companies make money by charging you interest. Renting is a great way to draw in customers who don't have discipline to save money on their own. If you have medical bills, why is this even a consideration?

To the poster:
1. If you don't want people's opinions, then don't post to places like this.
2. Just because some people aren't good at saving money, doesn't mean that you specifically are or aren't (nor was that stated anywhere in my answer).
3. Rent to own places do make money by charging interest. Fact.
4. Most people will agree that paying off medical bills are a little more of a priority than a leather living room set or whatever.
5. By your own account, you say: "We have some medical bills that need to be taken care of first."
6. Learn to spell climB.

Answer 5

Rent to own is not a good idea! They always "jack the price" since they know they have a sucker. I have never seen one work out to the buyer's benefit.

Answer 6

don't do it

"...a rent-to-own industry that preys on customers who lack the money to buy items like furniture, televisions, refrigerators, washer-dryers and other household goods - even pots, pans and dishes...."
http://www.alternatives.org/renttoowntip.html