Copyright Law

What are the Pros and Cons of Rent-to-Own Agreements?

A rent-to-own agreement is a type of agreement that is signed between a tenant and a landlord over a particular piece of property. In this type of deal, a rental property is committed for a particular duration, and there is the option to purchase it before the end of the lease duration. The two parties of such contracts are the sellers – or the party that wants to sell the property – and the buyers, or the ones who purchase the same. Find out about the advantages and disadvantages of Rent-to-Own Agreements.

Advantages and Disadvantages for sellers

The advantages include fast flow of income from rental payments and steady and long-term payments. In case it has been tough to sell the property, it could be a good way to sell it finally. The rents that are obtained, along with the fee option, is frequently above the average of the market price.

In case of a change in the market, sellers will be locked into the agreement and cannot sell the property. In case a specific purchase price is included in the contract, sellers might have to sell their property for less than the present market worth. If there is movement of the market in an unfavorable way, potential customers could opt out and the seller would face a hard time in selling or even renting the property out. He would have no flow of cash.

Advantages and Disadvantages for buyers

In case the buyers is trying to improve his credit and does not have any down payment. A Rent-to-own free lease agreement template can provide them with the time for improving their credit score, pay for a down payment and pay debts off. In case a sale price has been determined and consented on, the customer is protected from a rise in home prices and some equity would be earned by the time of purchase.

However, there is the risk of the buyer not being financially prepared to buy at the lease-period end. You may also download a free lease agreement in Texas or Florida from the website


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