Many people who sign rent-to-own agreements or land contracts end up evicted, not homeowners. Rent-to-own agreements and land contracts are promises to buy/sell property or a mobile home over time. Sellers may try to evict buyers during the agreement. As a result, many buyers do not end up actually owning the home, even when they have made paid for years.
In a rent-to-own agreement, make sure that you understand:
who will be responsible for repairs, taxes, and insurance
how your payments are being used (For example, whether your monthly payment is fully or only partially being applied to the purchase price of the house)
what happens with missing or late payments or other violations of the contract (For example, will you be evicted? What does the contract say about the returning your down payment and payments you’ve already made?)
Every part of your agreement must be in writing. Do not sign it unless you understand and agree with all the terms. If you have questions about it, you can look for legal help.
Last Reviewed: November 21, 2023