It’s simple. There are two types of rent to own programs in Georgia, lease purchase or lease option. The terms “lease option” and “lease purchase” are sometimes intermixed, but they are different.
Lease Purchase
At the end of your lease agreement, you purchase the home. It is a contract to buy with a delayed closing date and a lease to cover the issue of possession. This type of agreement is the same type of lease purchase program offered by licensed real estate brokers.
Lease Option
At the end of your lease agreement, you have the OPTION to purchase the home. It is a contract to buy with a delayed closing date and a lease to cover the issue of possession. But, you are not obligated to buy the home.
Depending on your situation, there are advantages and disadvantages to both programs. So, ask the property manager or owner how their program is structured.
A rent to own program is more valuable than just simply renting. You don’t have to bother with banks, mortgage brokers, or real estate agents. You can enter into a rent to own agreement directly with the property owner and just deal with them at the end of your agreement.
Rent to own homes in Georgia are rare and vary among investors. Most investors want to hold onto their properties for the long term. They want you to pay their mortgage. But, with a rent to own home, you are given the ability to build equity while you rent. Getting into a home with a low down payment will help you repair your credit (if needed) and build valuable equity in your home during your lease agreement period.
You are purchasing the home from the owner now and delaying the closing to a later date. This is the main difference between you and a typical renter. A renter has no rights to the home when the lease is up. At the end of your lease, you finalize the home purchase and use any equity you built up towards the purchase price.