Rent to Own FAQ – Who covers the mortgage, tax and insurance expenses in a Rent to Own?

An important question about rent to own is with respect to the 3 major expenses of owning a property. People commonly ask about taxes, insurance, and condo fees, and who pays for what in the rent to own transaction.

The answer in all 3 cases is that the investor pays, NOT the client. Since the investor holds title to the property during the rent to own term, they cover taxes, property insurance, and condo fees since these are mandatory expenses.

One thing to note here is that while the investor will be required by the first mortgage lender to insure the property itself, clients are responsible for insuring their own belongings. We strongly recommend that all rent to own clients attain a tenant’s insurance policy to protect their personal property and provide personal liability coverage since they will be building equity of their own which they’ll want to protect.

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