Bankrate has some advice for those of you who want to buy the home you are currently renting.

With the market in shambles, renters have some leverage in the negotiations.

A rent-to-own arrangement, also referred to as “lease-purchase” or “lease-to-own” deal, is generally a binding agreement for a renter to buy at the end of a set period. In a seller’s market it’s harder to get landlords to agree to lease-options. But in many respects, the timing seems right for your parents to talk with the owner about structuring an option arrangement.

Rent-to-own arrangements are generally structured so the renter/buyer agrees to pay above-market rent (20 percent and up) over a period ranging from one to three years in order to accumulate the equivalent of a down payment. Thus, if your parents are paying $1,200 per month in rent, they may be asked to boost that to $1,500 per month for say, a 30-month period, thus accumulating a $9,000 “down payment” in that period. Typically, the buyout price at the end of these deals is at least 110 percent of the price the owner originally plunked down for the house.

An advantage of rent to own is that lenders generally require little or no additional down payment and will assume a mortgage that people like your parents may not have been able to get on their own, particularly if they suffered past credit problems. (By the way, your mom and dad will probably be expected to handle maintenance and upkeep on the house during this rent phase.) Make sure you or your folks get a few “comps,” or comparative prices of homes that recently sold in their neighborhood, to give them a foundation for their offer. Realtor offices are pretty good about releasing some of these because they’re hoping to get your business.

Might be something to think about for those of you who are renting but really like the place you’re in and want it to be all yours.

Lease-option best for rent to own [Bankrate]
(Photo:stirwise)

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