Picture this agreement between two players in a board game: ‘If you land on my property 10 times, pay $5 more each time, and then you can buy it for $200.’ The first player still owns the property for those 10 turns, but the second player has secured a set price and (potentially) first-in-line status to buy.
It’s more complicated than just paying rent, and it has a different set of risks than just selling and buying. The final deal is set in the future, and is less predictable. These two players have basically constructed a rent-to-own agreement. They have a rental agreement, with an option-to-buy agreement attached.
Rent-to-own agreements are used in the real world as well, for things ranging from cars to buildings. Rent-to-own gives parties a different set of tools and risks to reach agreement. They can be complex, and legal advice may be prudent.
At Title Junction we care about helping you stay informed throughout your real estate transaction. Have questions? Give us a call at 239.415.6574.
In case you missed it, check out our last Title Junction post: I Found A Home Buyer…Now What?