Rent to Own Article

Pretty good rent to own article, things to note:

In the current market, lease-option agreements can grow the pool of potential buyers by attracting purchasers who are not quite ready to qualify for a mortgage. They also can be attractive for would-be buyers who have relocated and are trying to sell homes in other parts of the country.

Also a great overview of how the lease to own process works:

Lease-option contracts are written for individual homes and situations, so there are few fixed rules. However, both parties usually agree on a few general criteria.

The contract usually states that the buyer has to close on the residence within certain time period, usually a year or two. Homeowners avoid longer contracts, because of the risk of losing too much on the upside should real estate values appreciate quickly.

Also, buyers are required to put down a hefty upfront payment, usually between $3,000 and $5,000 for a typical home. In some cases, that money is put toward the eventual down payment.

The buying party also pays rent, giving the owner a monthly income stream to pay or offset the mortgage. Typically, a portion of each payment is set aside for the down payment.