Discussions

Just wondering how rent to own works on a home ? We have seen this on different websites and just curious. Is the a specific way or is really up to the home owner.

Hi. I’m a mortgage broker in town and rent to owns are notoriously hard to complete. Check out the CMHC website and its guidelines for rent to own, and speak to a lawyer to ensure that your agreement is legal and registered against title. It’s worth it to spend the time and money upfront to make sure everything’s done properly. Hope that helps! And feel free to message me if you have any other questions.

You pay what would be the normal rent for a house, say $1200 plus you'd add an extra $500 or so to that as a "Payment" that gets set aside to be used as your "downpayment" after 3-5 years when you go to apply for a mortgage. I'm not a real estate pro but I think the logic is with a sufficient down payment almost anyone gets approved for a mortgage. That has changed in the last few years, but used to be the case.  
 
If you're thinking "will someone let me make payments until the house is paid off" I'd say that's very unlikely. As someone who has done that twice in the past I can tell you the tenant never follows through.  
 
Renting to own a home is like renting to own anything else...you're just not going to win, you will always end up paying more (Substantially more) than if you just rented, put your money aside to save for the downpayment and tended to your bad credit.

I'm not exactly sure but what I have understood is it is a agreed upon amount for rent,and down payment. Also the renter would most likely be in charge of all Bill's and expenses like taxes,insurance,maintenance etc. But yes I would definatly get everything in paper and also go through lawyers and make sure everything is good and legit.

You don’t see them too often, as they can be very risky for both the seller and the tenant. I agree with Mr. Dobalina only when mentioned that you’re better off to start socking money away in a down payment account (tax free account can be utilized for some of the savings).  
 
While renting to own unless you have a comprehensive contract, you are still always a tenant. When and if the time comes to purchase the home (maybe 2-3 times as long as saving on your own each month) and the value of the home jumps, then what?  
 
These things likely need some serious legal guidance on both sides to make it work so one party doesn’t jump ship or change the terms agreed upon...that is, if you can actually get both parties to sign.