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Buying a home is a lifelong dream for most families, but it can be difficult for many people to achieve through traditional methods like mortgages and other financing options. Rent-to-own options have grown in popularity because they often fill that gap and help people buy without a classic mortgage. However, these plans also come with some significant risks that may not be obvious at first glance. Here are ten things you need to know about rent-to-own homes before you sign any leases or contracts.

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1. You're Still Paying Rent

As the name implies, rent-to-own homes do still involve paying rent to a landlord. The exact terms can vary widely, but in general, you'll be paying fair market rates. You may also pay a little more money each month, which is put towards the home's purchase price. For example, if you rent a house worth $1,000 a month in rent, you may pay $1,250 a month. The $1,000 goes to your landlord, while the $250 is put towards the purchase price.

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