Buying property is a serious transaction. It is important to completely understand what you are buying and how you are buying it. A common question that arises is how does rent to own work. It is important that you understand the conditions for your particular rent to own situation.
Typically, the person selling the property in this fashion fully owns the property. They make the decision to forgo a lump sump payment and instead receive the full price of the property in payments. The payments made are considered rent as often times the ownership is not transferred until all payments have been made.
These types of transactions are commonly private transactions. It is important to make sure there is a contract fully outlining the terms and conditions of the payments especially if it is a private transaction. It is a great alternative for purchasing a home without procuring a bank issued loan.