Image Source: Quicken Loans
You’re ready to buy a home, but there’s a problem – you can’t qualify for a mortgage loan. Maybe your credit score is low, or maybe you simply have too much debt and not enough income coming in each month.
This doesn’t mean that owning a home is out of your reach. You do have an option, and that is to rent-to-own.
In a rent-to-own agreement, you pay monthly rent to the owner of a home, much like you would in any other rental agreement. However, you pay a bit more each month, and that extra money goes toward reducing an agreed-upon final purchase price for the home. After a set period of time – usually from one to five years – you have the option to purchase the home, with the sales price reduced by whatever extra money you paid to the owner during the rental period.
Read more at Quicken Loans