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rent to buy

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A purchasing arrangement where you rent an item like a laptop, TV or fridge for a period of time, such as three years. At the end of that period, you pay an agreed amount to buy the item. This is stated in the agreement. You do not own the item until you’ve made all your payments. This is different from a consumer lease where, at the end of the lease, you don’t own the item. Not to be confused with rent to buy home ownership schemes, which are high risk and may target people ineligible for standard home loans.