Choosing a rent-to-own option when purchasing a new home is quite popular today. The main reason for this is that it has become extremely difficult to qualify for mortgage loans from banks or other lending institutions. Additionally, because of today’s economy, credit problems are all too common.
Advantages of Rent-to-Own
There are some obvious advantages of purchasing a home on a rent-to-own contract. For one thing, you will not need a large down payment to move into your new home. You also do not need excellent credit when you choose a rent-to-own option. So long as you have steady employment, you may qualify for a home.
Another benefit to renting a home to own is that if something goes wrong with your house, you typically do not have to spend your money to fix it. You will not have to carry homeowners’ insurance on the property either. All of this is the landlord’s responsibility. However, you may wish to take out a renter’s insurance policy to protect your belongings.
Disadvantages of Rent-to-Own
Just as there are some advantages to renting-to-own, there are a few disadvantages as well. Some of the most common problems can involve disagreements between you and your landlord. This occurs when it is not clear as to who is responsible for such things as repairs, mowing the lawn or replacing broken windows.
Sometimes, even when landlords are responsible for various repairs and/or upkeep, they fail to comply. If this happens, you may have no choice but to pack up and move. However, if you move, you lose all of the money that you put into the home, and you will need to start all over somewhere else.
As you can see there are both pros and cons to choosing a rent-to-own option for purchasing a home, and it is essential that you examine both sides closely before making your decision. If you can work out an agreeable contract with your landlord though, renting-to-own a home can be a terrific decision.
Copyright 2012. As licensed to eREALTY. All rights reserved