Top 6 Ways Rent to Own Homes Make Sense Today

This year, has been happy to welcome more visitors to our website than ever before. The popularity of rent to own homes continues to grow rapidly as more and more people learn the advantages of a lease option home purchase.

These days, it's not too difficult to find someone making an argument in support of renting, but not buying a home now. These people are afraid housing prices, which are already lower than they've been in years, might fall further. On the other hand, there are many who point out that today's low, low prices make owning a home more affordable now than it has been in decades. It is not unusual to find homes for sale at prices that are cheaper than rentals in many cities across the country.

But the smartest argument is in the middle of the rent versus buy discussion. What middle ground lets you have it both ways? Rent to own homes do.

In the middle is the path that insiders say makes the most sense today. And that is buying rent to own homes or homes for lease with an option to buy. We absolutely agree.

Let's consider the 6 main ways the insiders say that rent to own homes make sense in today's housing market.

Reason 1: Get Started Without a Bank Loan. It can be very time consuming and difficult to qualify for the mortgage loan you want an deserve. Bank home loans are very serious business. Without a large downpayment in hand, it is hard to get started with home ownership. Rent to own houses avoid banks up front. If a good tenant can commit to making regular rent payments, that same good tenant can commit to be a home owner with rent to own homes. A mortgage loan comes in later, after the renter has taken their time to build up a downpayment and qualify for a loan from either the seller directly (in an owner financed homes purchase), or through a bank or a friendly local credit union.

Reason 2: Low Home Prices = Low Rent. Home prices have fallen to very affordable levels in cities across the country. Prices are so low that a rent to own home monthly payment can be as affordable as a regular rent payment. Plus, a rent to own agreement credits a portion of monthly rent toward the future downpayment on the purchase price. If a tenant is going to pay rent anyway, why not put part of the rent toward the rent to own home's purchase?

Reason 3: Home Sellers Are Motivated. It takes a very long time for traditional homes for sale to find a buyer. Even then, sales often fall through as buyers have trouble getting loans finalized. Home sellers often cut prices to try to help complete a sale, but even that has limitations. As time passes, sellers need to consider more flexible financing options that help home buyers. Offering a lease with an option to buy agreement and accepting a rent to own agreement solves the problem for both the desperate home seller and the eager renter/buyer.

Reason 4: Rent to Own Allows Time to Fix Credit. Renters can get a lease on homes or apartments that allow for average or below credit ratings. Banks are not so generous in approving home loans for these same credit ratings. With a rent to own home, the tenant buyer has time to address credit issues and actually build a solid credit history through rent payments. While living in their home, they can take time to fix credit and qualify for the right home loan they need later.

Reason 5: Regular Rent Rates Keep Going Up. Regular rental housing (apartments, condo rent, townhome rent) is becoming more expensive. Many people are now spending up to 50% of their income just to pay their landlord rent. And the supply of rental housing is limited, so prices will continue to rise. Getting into rent to own homes is an attractive alternative to avoid increases in future rents. With a fixed lease option payment and a fixed rate home loan a few years later, today's tenant buyer of rent to own houses can keep payments constant, even if other rent rates rise.

Reason 6: Tremendous Tax Savings. Once renters of rent to own homes transition to paying a mortgage, the interest paid on the monthly payment can be deducted for income tax purposes. This alone can save thousands of dollars per year, and is still an very positive financial advantage for home owners.

These 6 reasons are powerful, but there are other ways rent to own housing is a great alternative today. Explore to see them all!