Rent-to-own homes are a type of agreement that allows renters to eventually buy the property they are renting after a specific period of time. Here are some key points to understand about rent-to-own homes:

• How it works: When you rent-to-own, you rent a property and make progress toward eventually owning it if you buy the home when the lease is up. Every month, a portion of the rent you pay to the homeowner goes toward a down payment on the home. You have the option to use the money that’s accrued to buy the home at the end of your lease term.

• Pros: Rent-to-own agreements can be an excellent option if you’re an aspiring homeowner but aren’t quite ready, financially speaking. These agreements give you the chance to get your finances in order, improve your credit score, and save money for a down payment while “locking in” the house you’d like to own. If the option money and/or a percentage of the rent goes toward the purchase price, which they often do, you also get to build some equity. It also gives you time to build credit if you don’t yet have the credit score needed to buy a house.

• Cons: Rent-to-own homes can be more expensive than traditional rentals, and the renter may end up paying more than the home is worth. Additionally, if the renter decides not to buy the home at the end of the lease, they may lose the money they put toward the down payment.

• Customizable terms: Rent-to-own contracts are customizable, meaning that the terms can be negotiated between the landlord and the renter. However, this generally works in favor of the landlord.

Overall, rent-to-own homes can be a good option for those who are not yet ready to buy a home but want to work towards homeownership. However, it is important to carefully consider the terms of the agreement and whether it is the best financial decision for your situation.