Renting used to be easy — you’re paying to live somewhere. Right? Makes no sense, though, when the value of a home is such that if you live somewhere you’re renting for X amount of years, you’d think that eventually you put in so much money that you’re well above the actual home value! It may seem like you’re being peppered into paying so much money.
This Is Why “Rent to Own” Has Become Such a Real Estate Staple These Days
This takes out that unfortunate reality of renting well beyond the value of the home and being provided the “option” to actually buy the property. Even your past rent could be factored into the cost! What a deal! Real estate investing at its best, right?
Many of the real estate transactions you’ll find clear across the board often are, in fact, rent-to-own homes. A buyer gets to lock in the price without committing to a 30-year mortgage. You can rent with the option to buy or move to a different house. There’s flexibility there. However….
Rent to Own Does Have Its Drawbacks
You’d most likely be looking at higher rent payments, for one thing. Higher than the market average. Back taxes, too, would be an issue, as well as the fact that you’ll still need to get a home inspector to show up (even though you’ve lived in the house for how many years?). All those extra costs—for a place you’ve lived in for X amount of years—does it seem worth it? Maybe, maybe not.
If you fall on hard times and can’t make payments, not only do you get evicted from the rental, but you could also end up with a foreclosed home, and that doesn’t look too hot on a credit report. Plus it’s always a crap shoot when a buyer and seller get together when negotiating a price unless you have a specialized rent-to-own consultant helping you out through all of that. There’s the unknown basically—will the renter end up being a buyer? Who knows…. So it gets pretty complicated.
The Bottom Line: Is That You’re Hamlet
And you’re holding onto Yorick’s skull, pondering the question and brainstorming with the best of them: “to rent, or not to rent, that is the question…. Whether it’s nobler in the mind to suffer the slings and arrows of outrageous fortune!”
You’ve got a tough dilemma on your hands. However, you’ve got renting resources out there with Assisting Renters, for one. At the very least, you end up having a house!