It's how I bought my current condo. Due to a few minor marks on my credit, the banks wouldn't touch me at a decent rate. The guy that owned my condo had it paid for, just wanted to get rid of it. Looked at the credit, but also looked at the fact that ALL my income is disposable, I had good job time, my car is paid for, I don't have a credit card, and I had a pretty nice amount available for a down payment. We discussed it and came to agreement, where I buy the house, he holds the deed, I get contract stating that after 360 payments, the place is mine. Lawyers approve it, and it's valid. Fixed rate of 4%. I can pay it off without penalty, I can claim first time home buyers credit on my taxes (I did) and if I ever do anything ri-Tard-like, and get sued, theoretically, the condo isn't mine, so I can't lose it in a lawsuit. Not that I'd ever do anything like that to GET sued, but stuff happens. It's one less thing to worry about. It worked out with the best of both sides for me. It's not so much rent to own, as a seller held mortgage, though. I'm not paying stupid high fees, or interest, and the price I got is comparable to what condos in my complex sold for last year, so, good price, too.