What do I need to know about lease to own?

Answer 1

If you are late on a payment or miss a payment, you are evicted and you do NOT get any money back, nor can you sell the house.

If you purchase the home the normal way, you'd still get in trouble with your lender and perhaps lose the house if you missed a payment, but you would also be able to sell it to pay off the loan.

Answer 2

well leasing a car is smart.
lease for four years at about 3500-4grand,at end of lease
just get a brand new car,and lease again.rinse and repeat

you can drive the car of your dreams every for years!!

Answer 3

It's all explained here

http://answers.yahoo.com/question/index;_ylt=An0hFQWV.U.ZGky8plAr7ivty6IX?qid=20070314161548AAJc24M&show=7#profile-info-4313398fb5f20ff628a158ad4835f3b8aa

Best of Luck

Answer 4

make sure the contract is reviewed by YOUR lawyer. it is the only way to guarantee you know what you need to about the situation your getting into.

Answer 5

A lot of people and consumer advocates look at "rent to own" or "lease to own" as a scam and a way to exploit poor people.

New Yorkers who buy televisions from rent-to-own stores could end up paying 300% more than they need to because of a major loophole in State law. This investigation, which compiled prices of three common products at New York's 38 Rent-A-Centers and compared those prices to local retail stores, national retail chains and online vendors, found rent-to-own stores charge significantly higher prices than other stores. http://www.nyccouncil.info/media/reports.cfm



Washington, D.C., attorney general targets rent-to-own
By Richard May
- - - - -
[04-27-2007]

In a mirrored fashion of the recent Buffalo News series on the "High Cost of Being Poor," Washington, D.C. Attorney General Linda Singer announced April 24 that she will be working with the city council to introduce legislation aimed at industries who do business with low income consumers, specifically citing rent-to-own.
In a Washington Post story that ran on April 26, Singer is quoted as saying "we want to make sure consumers are treated fairly and they have the ability to make good choices in how they spend their money." In April 2002, the Washington, D.C., city council passed a law regulating the rent-to-own transaction and mandating pricing and advertising disclosures as well as other consumer protections. http://www.rtohq.org/news.aspx?id=488

Renter beware - fraud in rent-to-own business
Washington Monthly, Oct, 1993 by Mike Hudson
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To test what they do tell customers, I visited 15 rent-to-own stores in Georgia, New Jersey, Pennsylvania, and Virginia. I asked questions just like any customer off the street. Among them: What percentage of customers end up owing? Not one of them gave the 25 percent figure that's cited in official settings. Seven estimated 80 percent or more. Six others gave estimates ranging from 45 percent to 70 percent. At another store, a salesman said simply: "Almost all of them."

In congressional testimony this spring, the industry's trade group said that 12 percent of rent-to-own merchandise is stolen. However, the industry association's chief attorney wrote in an 1989 trade journal article that rent-to-own stores' losses from stolen merchandise consistently averages about 2 percent of revenues - considerably less than what credit-card companies are forced to write off in unpaid debts.

As for free repairs and replacement, a lot of the stuff - such as furniture - requires little maintenance, and much of it is covered by manufacturer's warranties. A Rent-A-Center study found that less than five percent of their merchandise needed repairs.
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But the spectre of damaged goods is actually a cash cow for the industry. Most stores require customers to pay "damage and theft waiver fees" - essentially credit insurance that covers the store if something happens to the merchandise. In return for the fee, you won't owe anything to the store if the merchandise is damaged or stolen during the contract period. The downside, of course, is that you're also out all the payments you've already made and can't keep what you've been paying for.

Typically, a rent-to-own store will charge you $1 a week in "waiver" fees for insurance - so that a $330 TV from Rent-A-Center (for which you're paying $1,200) costs another $74 to insure. For roughly that sum you could buy enough renter's insurance to cover $10,000 or even $20,000 worth of personal belongings. Rent-A-Center, meanwhile, makes a bundle on the extra fee: Ramp's research has shown that Rent-A-Center has to write off only about a nickel in claims for each dollar it takes in "waiver fees." (Another big money maker is fees to forgive late payments. Rent-A-Center customers in Minnesota paid $1.3 million in "reinstatement" charges over one four-year period).

Even where lawmakers haven't been snookered into buying this industry propaganda, rent-to-own dealers have found ways to get around the law. When Pennsylvania passed a statute in 1989 that defined rent-to-own as a retail sale and sets an annual interests limit of 18 percent the state's rent-to-own dealers claimed the law would put them out of business. It didn't. Instead, most ignored it or found ways to skirt it. Some, for example, now offer straight rentals ("rent-to-rent") with the promise of a "rebate" that the customer can use to purchase the item at the end of the contract. An undercover investigation by the Pennsylvania attorney general's office found rent-to-own stores were still charging annual interest rates from 82 to 265 percent.

But the spectre of damaged goods is actually a cash cow for the industry. Most stores require customers to pay "damage and theft waiver fees" - essentially credit insurance that covers the store if something happens to the merchandise. In return for the fee, you won't owe anything to the store if the merchandise is damaged or stolen during the contract period. The downside, of course, is that you're also out all the payments you've already made and can't keep what you've been paying for.

Typically, a rent-to-own store will charge you $1 a week in "waiver" fees for insurance - so that a $330 TV from Rent-A-Center (for which you're paying $1,200) costs another $74 to insure. For roughly that sum you could buy enough renter's insurance to cover $10,000 or even $20,000 worth of personal belongings. Rent-A-Center, meanwhile, makes a bundle on the extra fee: Ramp's research has shown that Rent-A-Center has to write off only about a nickel in claims for each dollar it takes in "waiver fees." (Another big money maker is fees to forgive late payments. Rent-A-Center customers in Minnesota paid $1.3 million in "reinstatement" charges over one four-year period).

Even where lawmakers haven't been snookered into buying this industry propaganda, rent-to-own dealers have found ways to get around the law. When Pennsylvania passed a statute in 1989 that defined rent-to-own as a retail sale and sets an annual interests limit of 18 percent the state's rent-to-own dealers claimed the law would put them out of business. It didn't. Instead, most ignored it or found ways to skirt it. Some, for example, now offer straight rentals ("rent-to-rent") with the promise of a "rebate" that the customer can use to purchase the item at the end of the contract. An undercover investigation by the Pennsylvania attorney general's office found rent-to-own stores were still charging annual interest rates from 82 to 265 percent.

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