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Renting to own, lease option, rent to buy, and lease with option to purchase are all common terms used to describe renting a property with the option to buy the home in the future. There are several variations of a rent to own agreement, but most rent to own contracts have two standard contract conditions. First, a seller/landlord agrees to rent a property to a buyer/tenant, and second the contract includes an option to buy the property at some time in the future.

In most cases the buyer/tenant gives the seller/landlord an upfront fee to rent the property with the option to buy it at a predetermined date. Frequently a portion of the monthly rent is applied to the down payment of the house. At the end of the lease term, the tenant has the choice to buy the property or they can waive their option; however, if the tenant waives his or her right to purchase the property, he or she forfeits any upfront or extra money paid for the option.
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