Rent to Own is a very familiar phrase to all of us.
Rent to own merchandise has grown to greater heights and some, like Rent A Center and Prime Time, built their kingdom with this business. It is true and almost every one of us knows that we will be paying much more than the worth of goods in this rent to own merchandise. In the case of real estate business as well, this business trick cost you dear.
I know many people who opt for this since they have bad credit record and generally people with good credit avoid going through rent to own route. This rent to own may be attractive for short term period payments, but for long term payment periods it will turn out to be very expensive. Typically this contract will go for 15-20 months. The claim of paying few dollars a week is really attractive but if you go back and check, you will really become sad in seeing that you have paid more than the double the worth of the item. In the case of real estate, you will be paying all types of taxes in addition to the rent payments. Like any other rent to own merchandise, rent to own home also has many disadvantages.
As I already mentioned, for those who are with bad credits, this is a viable option. But for many others rent to own will drain the wallet much more than that with a mortgage loan. In this case as well, you have to take a mortgage for the final payments. The one advantage (some may argue it is disadvantage) is that rent to own homes are generally listed by the home owner. In this way you can deal with the home owner directly. Mostly this process starts as a traditional leasing and then converted to rent to own merchandise, if you want to own the house some time later. You can make a deal with the home owner and this arrangement can continue for few years until you are ready to acquire the home. Some owners will be very genuine and gentle; they will see that they get the proper value for their home.
But some other owners may charge you more amount and they will be inclined to make more profit out of the property. As I have already said it is a good option if you are in a state with bad credit and getting mortgage loan is a distant possibility. Many people consider this as a better option than an apartment, but many others do not like to go for this option as it is very expensive. With rent to own, you can be happy that you are paying for the home in installments and not the rent.
As all through the article I have highlighted, in some situations rent to own is a fine option. You have to discuss thoroughly with the owner all aspects, the total payment for the home, monthly payments and also the duration of the period. In this process you will know all the details before entering into the deal.