Rent-to-own is the best option for buyers who have a problem in financing or paying for down payments. Carefully evaluate both sides of the rent-to-own process before pursuing one. Look before you leap. Educate yourself with the terms and conditions first and don’t just agree to something especially if it isn’t clear. To strengthen your decision whether to buy or not to buy, here are the disadvantages of RTO:
Cost – A house that would have been purchased at $300,000 could have a price of $340,000 after a one-year-rent-to-own agreement and even higher at the end of a two-year agreement.
Higher Payments – The monthly rent you pay under a rent-to-own agreement is higher than the rent you pay under a normal rent agreement. The main reason for the higher rent is the fact that you are both paying for the space and for the ‘option to buy’ the property at the end of the set lease period.
Possible Eviction – An eviction may occur even when a single payment is missed. This means that if the renter missed a payment, his/her payment intended for down payment will be forfeited because of a single missed payment. But of course, this may vary depending on the terms and agreements between the seller and buyer.
Cancellation of the Contract – RTO agreements don’t have the option for an event where the property is transferred to a third party, or if the seller meets an accident or death. Although insurance can cover payments in case something bad happens to the renter, but the seller may be justified in terminating the RTO agreement without having to refund the renter’s money.
Rent-to-own is a good choice but it’s also risky. If you think you are not yet ready, think carefully if you can adhere to the terms. Almost each and everyone of us is dreaming of having their own Mesa Real Estate property, but is not ready yet to give up renting. Good news! Rent to own with its lease-option-contract can make your dream of buying a property possible. Simply visit Potomac Real Estate for buying advantages.