Rent to Own Laws in California

In a rent-to-own transaction, you pay rent on a piece of property for a specific period of time, after which the property owner gives you the property. Rent-to-own transactions often cost far more than purchasing property outright, according to the California Department of Consumer Affairs. In California, the property owner must disclose how much the renter is spending over the cost of the property and give the renter the option of purchasing the property early rather than continuing to pay rent on it.

Disclosures

The property owner must disclose information about the total amount you -- the renter -- must pay to own the property, how long the rental is for, the rental's retail value and how much more you are paying to rent the property than you would if you bought it outright. The owner puts all this information onto a sticker and affixes the sticker to the property prior to showing it to potential renters.

Sample Contract

You have the right to view a sample contract prior to agreeing to a rent-to-own arrangement. Upon request, the property owner must provide a paper copy of such a contract and allow you to take the contract home. Property owners do not have to offer a sample contract unless you request one. Getting a sample contract is usually a good idea, according to the California Department of Consumer Affairs, as you can study it at home and consider the offer outside of the owner's presence.

Contract Requirements

The rental contract must contain the rental disclosures and a notice stating that you must make all payments on time throughout the life of the contract to own the property or pay the early purchase price. The contract must also state clearly what the early purchase price is and what the terms of the rental are, e.g. how often and how much you must pay. The contract is not valid until the renter signs it and gets a copy from the property owner.

Cancellation Rights

In California, you have the right to cancel a rent-to-own contract within three business days of signing it if you did not sign it in the property owner's office and the contract is for longer than one week. If you have not taken possession of the property yet, you are free to change your mind and cancel the contract. You may also cancel the contract at any time by returning the property rather than paying the rent due on it.