If you dream of owning a house but cannot afford a down payment or high monthly mortgage, then rent-to-own is the perfect solution for you. Rent-to-own is an ideal housing situation for low- and middle-income renters in Texas. Through rent-to-own, you can achieve your dream of home ownership without having to meet the qualifications normally associated with home ownership.
What is rent-to-own?
Rent-to-own gives you the opportunity to buy your rented home at the end of your lease. To qualify, you just need to sign an agreement and pay a small fee. While renting, you will continue to make monthly rent payments to your landlord. However, the landlord will apply some of the rent to a mortgage payment.
In a rent-to-own agreement, the lease term may last up to two years or more. A longer-term lease gives the renter plenty of time to save up and make small payments on the house. Renters do not necessarily need to commit to purchasing the home. At the end of the lease term, they are often allowed to change their minds about buying.
What are some benefits of renting-to-own?
Renting-to-own provides several advantages for the renter. Instead of paying a large down payment, you only need to pay a small fee. Furthermore, you do not need to demonstrate a high income or perfect credit score to rent-to-own. These benefits lift the usual barrier to homeownership for low- or middle-income aspiring homeowners.
Can I use my Section 8 vouchers for rent-to-own?
In Texas, Section 8 housing beneficiaries can use their Section 8 vouchers to make payments on a rent-to-own home. The U.S. Department of Housing and Urban Development (HUD) allows participants in the Section 8 Homeownership Voucher Program to purchase a home using their government benefits. Thus, current Texas Section 8 beneficiaries can apply to participate in the rent-to-own program. Those who are not currently receiving Section 8 benefits can also apply. Many Texas rent-to-own participants also qualify for housing assistance, such as first-time homebuyer grants, that can make buying a house even easier.