Rent to own homes serve an important purpose in today's gloomy economy: They give individuals the chance to determine if they'd be better off as renters or homeowners.

The wave of housing foreclosures that has swept across the country since the start of the Great Recession proves one thing: Many people became homeowners who weren't financially qualified to make the leap from renting.

Banks and mortgage lenders passed out loans to borrowers with low credit scores, piles of debt, and shaky employment histories.

It all led to a soaring number of foreclosures. RealtyTrac.com, an online provider of foreclosure data, reported that the United States saw 2.8 million foreclosure filings in 2009.

That stands as an all-time record.

Clearly, many people purchased homes who would have been better off financially if they had remained renters.

People who are debating the merits between renting and owning a home should know that there's an option available that will let them experience homeownership will retaining the flexibility of renting – rent to own home to own homes.

Under the rent to own process, which has grown increasingly popular thanks to the sluggish real estate market, individuals rent a home just as they'd rent an apartment.

There's one crucial difference, though: They have the option each time their lease expires to either leave the house, renew the lease, or make an offer to buy the home in which they are living.

Many rent to own agreements even allow residents to pay a little extra each month that the landlord uses as a type of down payment.
If the residents decide to make an offer on the house, they can use that extra money to pay down a portion of the house's final sales price.

This arrangement makes especially good sense for consumers with low credit scores. Today, mortgage lenders rely heavily on these three-digit scores to determine who gets mortgage loans and at what interest rates.

Consumers with low scores, under 620, will struggle to obtain a mortgage loan from conventional mortgage lenders. It might make more sense for them to instead, enter a rent to own agreement and slowly rebuild their credit scores. They can do this by making all their monthly payments on time and reducing their credit card debt.

They can then either purchase their rent to own homes or make an offer on another house, confident that their credit scores are now high enough to make them a better credit risk in the judgment of mortgage lenders.

Moving into rent to own homes serves an even greater purpose for many consumers, though: It teaches them whether homeownership is right for them.

Owning a home is a big responsibility.

Homeowners have to maintain their homes both inside and out, something that requires a significant amount of work. They have to pay their mortgage bills on time or face foreclosure. And they have to pay the list of other expenses that come with owning a residence.

By living in a house rather than an apartment, rent-to-owners can gain at least a taste of what homeownership is like.
Some might discover that they'd rather not spend their weekends fishing wet leaves out of gutters or mowing the front lawn. It's better for them to discover this before purchasing a home rather than after.

Rent to own homes are becoming increasingly easy to find as sellers struggle to move their residences in this dismal residential real estate market.

This is good news for consumers who want to settle once and for all whether they're destined to be renters or owners.