Two options for rent-to-own
A RENT-to-own agreement is essentially a fixed-term lease, which includes an option for a tenant to purchase their home from their landlord – at a price determined upfront at the termination of, or prior to termination of, their lease. In some agreements a bigger than usual rental is paid to create a deposit for the purchase. In other agreements a tenant will pay a set amount towards rental and then an additional monthly amount towards the purchase price of the property.
The rent-to-own documents must also include a sale agreement that is automatically introduced once the option to buy is exercised. The property will then be purchased once the tenant has secured a home loan.