What is Rent to Own? RTO is simply deferred ownership. Deferred ownership terms can range from 1 month to 60 months. There are several types of rent with option to buy. It is most commonly used for rent-to-own houses, condos, investment homes, and other personal items such as cars, boats, furniture rent-to-own.
Why do you want to rent to own? People with bad credit, lack of income, saving for a down payment are the ideal candidates. Most of the time, rent-to-own is a great program for first-time homebuyers.
What is the difference between rent-to-own and lease-option? With rent-to-own, the terms are defined for a specific time to be fulfilled with equal monthly payments, once the time period is over, title is transferred. This is simply created with a sales and rental agreement. Leased: Options that the buyer is not required to purchase at the end of the term.
What is the benefit to the seller of using RTO? This is a common way for a seller to quickly sell their home or property, since more people can rent to own than buy outright.
Is rent-to-own more expensive than lease-option? Renting typically requires one month’s rent and one month’s deposit, while the lease-to-own option would require a 1-10 percent down payment, which is non-refundable and often more expensive. This option makes it easier to own rather than lease – own to own. Rental properties are generally held by the potential buyer.