The answer to this is pretty simple. When you rent a home or apartment, all of the rent goes straight to the landlord. However, with a rent to own home, a portion of the rent goes towards the down payment and closing costs of the house when the rent period is over. This is the major difference for rent to own homes, but there are quite a few more that you can find below-
• When you rent, the landlord doesn’t want to sell the property. With rent to own, you don’t have a landlord, you have a seller whose goal is to sell the home to you.
• Renting involves no agreed purchase price since the home or apartment is not for sale. However, a purchase price is locked in at the beginning of the contract with a rent to own home.
• Rent for an apartment or home will be set at market rates, whereas rent for a rent to own home will be a little bit higher, with the extra cost going towards the down payment and closing costs when the renting period is over.
• A security deposit, first month’s and sometimes last month’s rent will be required when just renting. With a rent to own home, an option consideration fee is required at the beginning of the contract. You may also need the first month’s rent and sometimes a security deposit. Read more about rent to own fees here.
The option for rent to own is great for those who cannot afford to buy a house immediately or have poor credit and cannot get approved for a loan right away. During the renting period, you have the chance to work with our credit repair specialists to get your credit score up and get approved for a loan when it comes time to buy the home. So your next step is to fill out our form (above) and get in contact with our specialists to help you start your process today!
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10200 E Girard, Denver, Colorado, 80231