Is Rent to Own Better For You?
For a short period of time, rent to own properties maybe advantageous, but in the long run, it’s not. Rent to own merchandise for example, may sound quite compelling at a few dollars a week. The agreement is normally for around 15 – 20 months, which is where the company makes their money. Although you may be paying just a few dollars a week, the total amount quickly adds up to nearly twice the cost of the item.
Along with paying rent, you’ll also have to pay applicable sales tax as well. Like rent to own merchandise, rent to own houses have disadvantages also. Even though it can be great for those with not so great credit, you’ll normally end up paying back a lot more than you would with a mortgage. You’ll still have to pay back your lender with a mortgage, although that amount won’t be nearly as high as it would if you decided to get a house on a rent to own basis. (this is not just a theory, it is a fact and you can understand this easily by just looking at any mortagage calculator out there , you will see clearly the results – this strategy only works if you understand the clear value of your house, and to do this you need to use a proper real estate appraisal software to help you understand the process.)
In most cases, rent to own houses are put up on the market by the owner. This way, you’ll deal directly with the owner. It will start out as a traditional lease, then proceed to a rent to own basis if you decide you want to keep the home. You and the owner will then work out an arrangement, which will normally be quite a few years. Some owners are very flexible and will work with you just to get the price they want for their home, while others will charge you quite a bit more, in order to make a hefty profit.
