Everything You Should Know About Rent to Own
- RTO is a rental program, not a loan so NO credit is required. You are simply renting the rental property on a month by month basis.
- The RTO contract may be canceled at any time. Simply call and request that the rental property be picked up from your location.
- Upon completion of the rental contract, either by taking advantage of the early payoff option or by completing all of the monthly rental payments, the rental property is yours!
What is the interest rate/finance charge?
There is no interest rate or finance charge. However, since this is a rental contract, rental fees are charged. The total contract amount may be figured by multiplying the monthly payment amount by the contract term.
May I pay extra down to lower the payments?
Since this is a rental contract and not financing, paying money down and financing the rest is not possible. As a rental, the payments are figured on the full value of the building. Making a larger payment up front is the same as paying the rent in advance, because we will apply it to future month’s rent. We recommend that you make only the required first month’s payment and a security deposit, then make your monthly payments while saving enough to pay off the contract in full to receive the Early Pay Off Discount.
What is the Early Payoff?
Early Pay Off (EPO) is offered as a promotion for customers who want to save money by paying off their contracts early. At any time during the contract, you may pay off the contract in full and receive this discount. EPO ranges from 40% to 60% of the remaining unused portion of the contract. The unused portion is time that has not transpired. Back rent is not discounted. If you make a payment that is larger than your regular monthly payment, but not equal to the Early Pay Off amount, the payment will be applied as advance rental payments only.
How many RTO contracts may I have at a time?
You may have up to 3 items per household, or $30,000 total, whichever is greater when you purchase from The Shed Builders. Units at the same address are considered one household.
Can I return my building without hurting my credit?
Most certainly. Flexibility is one of the greatest features of the rent-to-own program. If you no longer need the item you are renting and you are paid up through the month you return the item, no extra charges will apply and your account will remain in good standing. Best part of all – it does not damage your credit!
More to know about Rent to Own
Bankruptcy: A RTO contract is considered by law to be an executory contract. Should the contract become a financial burden, you have the option to be relieved of the contract by returning the item and no further charges will be incurred. Under United States Bankruptcy Law § 365, should you file bankruptcy, you have the option at that time to assume or reject the contract. You should consult legal advice for complete information and provide a copy of your Rental Purchase Agreement.
Late Payment: Due to the month to month contract of your Rental Purchase Agreement, all payments are due on the date (either the 1st or the 15th) that you have selected. If your payment is late it may be subject to a late charge up to $10.00. See your contract for details. Pay close attention to your due date and pay on time to avoid having your building picked up. If your account is past due, the rental company may pick up the building during normal daylight hours.
First Payment Default: State law provides you, the consumer, with a grace period depending on the state. After the specified number of calendar days of the month have passed, by the terms of the Rental Purchase Agreement, the contract has expired and we may attempt to pickup the building. If the rental company is unable to contact you and resolve the account, your building will be subject to pickup. To avoid this, we suggest setting your account up for automatic payment. It is also important to provide us with current contact information so we may contact you if necessary. Should your building be picked up as a result of non payment, you will have 14 days from the date of pickup to reclaim any belongings left inside or 7 days to reinstate the contract by paying all back rent and other fees due, plus a re-delivery fee. The rental company is not responsible for any items left in the building at time of pickup.
Moving: Your rented building may not be moved without express permission from the rental company and you must pay all fees associated with moving the building.
Improvements: Any improvements added to the building shall remain with the building if it is ever returned with no credit given to you.