real estate

Rent-to-own a home

Bankrate Audio » Rent-To-Own A Home

Listen to audio

Editor's note: This is a transcript of the audio file.

Want to buy a home but have bad credit, no down payment or a shaky job situation?

You're not alone. This desire to own but the need to rent now is making rent-with-option-to-buy deals more popular. I'm Janet Stauble with your Personal Finance Minute.

With these lease-option-to-buy arrangements, renters pay a fee for the option to buy at a specified later date. The deal can help some, but enter any contracts carefully.

If you can't buy now, what's really going to change to make homeownership viable down the road? You may not be able to boost your credit to qualify for a mortgage at the end of the option period. Talk to a lender first about the likelihood of qualifying for a home loan later.

These contracts don't offer the same protections as a regular home purchase, so consulting an attorney is a must. Problem is, people in the market for the deals are already strapped for cash, so legal fees could be cost prohibitive.

Want to learn more? Log onto I'm Janet Stauble.


Show Bankrate's community sharing policy
          Connect with us

Timely market news and advice for consumers ready to buy, sell or invest in real estate. Delivered weekly.


Holden Lewis

Jobs rise and so will rates

With the economy growing by 295,000 jobs in February, it looks like rising mortgage rates are here to stay.  ... Read more

Partner Center

Connect with us