Rent-to-own agreements: how do they work and can they offer a path to homeownership? [Yahoo! Finance]
NerdWallet, Inc. - Class A (NRDS)
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Source: Yahoo! Finance
The contract ‘gives renters the option to work toward buying the home they already live in'. | Credit: Peter Cade / Getty Images Sometimes, people may feel like they are stuck renting because homeownership is out of reach financially. But what if renting were actually a step on the path toward becoming a homeowner? In the case of rent-to-own agreements, it can be. These agreements are essentially rental leases that include an option (or, in some cases, an obligation) to eventually buy the property after living in it for a period of time. During this time, some of the rent you pay may go toward a future down payment. While this likely sounds like an appealing prospect, and it can have upsides, there are some definite drawbacks worth weighing first. What is a rent-to-own agreement? A contract that effectively “gives renters the option to work toward buying the home they already live in,” said Bankrate . Because of this dual purpose, the contract contains two parts: a standard r
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