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Has anyone ever bought a house using one of the Rent to Own Places?
I have two or three of those Rent to Own homes places emailing me since I registered with them. They all claim they can get you in a home in 30 days or less with just a small deposit and first months rent. A portion of the monthly rent goes towards a future downpayment, then in a couple of years (after cleaning up your credit) you have built up equity and go to a bank for a loan. What I wonder about though is none of them are in my city so how do they know local real estate? One is http://ownerwiz.com/ and another is http://www.rentalhouses.com/rent-to-own Thanks for any help.
3 Answers
- glennLv 71 decade agoFavorite Answer
I have been in real estate sales since 1978. I have several friends that used to be the "seller" in deals like this. They told me that they charged higher than normal rent and the overage went to any future down payment. They require a higher than normal deposit. They told me the "sale price" was always higher than if the people were buying in today's market. Most of them also told me that they required the "buyers" to be responsible for their own repairs.
With this arrangement the "seller" always made out very well. If you end up buying they are selling at a higher than market price and none of the down payment really came out of their pocket. If you did not buy then they keep the high deposit and all of that excess rent and get to sell it again.
If you read "The Jungle" by Upton Sinclair, it will show you how this stuff worked in 1900. It is pretty much the same today. When Theodore Roosevelt read this book he ended up passing a lot of legislation- but nothing about the rent to own stuff.
