What does rent to own mean (apartments, renter, loan)

[glass_of_merlot]

Im looking through craigslist for 3 bedroom apartments to rent in or around the area I'm currently are at. I sometimes see this listings "rent to own". A 3 bedroom 1,5 bath, 1759 sq feet for 925 per month. This is in Wrigleyville. Apartments like that runs over 2000 per month so whats the deal with this rent to own?

Thanks for educating me

[4122]

It means that you can rent a house first then buy it. When you rent a house first, you'll be able to buy the house cheaper than buying it without renting it.

[glass_of_merlot]

Originally Posted by PAHouseLink

Hey Merlot, it's really not more difficult than it sounds the problem (for Renter & Sellers) is they are almost never done correctly and the vast majority end with consternation, or worse litigation!

Here is a link to a blog post I wrote on the Rent to Own subject and how to avoid some common mistakes - Rent to Own Pitfalls

Thanks! I appreciate it and the link !

[Dport7674]

I saw a Dateline type show about rent to own housing..I don't remember the numbers or details but RTO is hugely in favor of the seller.

[Laughkc]

Please also consider that this could be a scam. The simple fact that the rent is significantly lower than surrounding properties is a huge red flag and likely not a legitimate listing.

[knitgirl]

Originally Posted by Laughkc

Please also consider that this could be a scam. The simple fact that the rent is significantly lower than surrounding properties is a huge red flag and likely not a legitimate listing.

You make a really good point. I'm pretty sure that in order for a lender to eventually give you a loan for that kind of property, that you would actually need to pay OVER market value, and only the amount over market value would be considered part of your down payment.