Prior to the collapse of the United States real estate market, it was virtually impossible to get a good deal when buying a home through a rent to own agreement. Since almost anyone could get a traditional mortgage, there was not much motivation for home owners to offer the option to rent to own. Why wait when they could get all of their cash up front and move on? Today, the market has changed considerable.
Thanks to the market collapse, credit crunch and ongoing recessions, the landscape of the entire market has shifted considerably. In the present economy, it is fairly easy to find sellers who are willing to consider a rent to own or owner financing situation. This is good news to the many buyers who no longer are able to qualify for a home loan.
A key advantage to sellers is that the willingness to accept a rent to own agreement greatly increases the number of people who can possibly buy their home. Increasing the pool of buyers can greatly decrease the marketing time of the home. Additionally, when a seller sells with rent to own, they are not required to offer a discounted price like they likely would if they sold through conventional means. Rather, they are able to command full fair market value.
The main reason the tenant buyers find rent to own arrangement so attractive is that they are able to move into the home that they plan on eventually owning now. They are able to enjoy the home for a couple of years while working on improving their credit enough so that they can qualify for traditional financing. Additionally, a portion of each monthly payment goes towards the purchase price in the form of a rent credit, so they are building equity from day one. Another reason many buyers like rent to own homes is that it allows them to experience what it is like living in a home before they make a long term binding commitment.
Since rent to own agreements are basically unregulated, pretty much all aspects considering them are negotiable. (Of course, there are some minimal state requirements) There are, however, standard features of a rent to own contract. One is that most call for a non-refundable option fee. Also, the rent credit is another standard feature. Most contracts also stipulate the agreed upon purchase price.