Rent Credits on rent to own deal

[George Smith]

Good afternoon,

Is anyone currently doing rent to own? I've got a question on the difference between what you pay the seller in rent and what you collect from the tenant buyer. I inquired with another investor in the area and he said that the bank does not see the rent credit(additional rent paid over market value) as part of the down payment when the tenant buyer goes to finance. I'm assuming this wouldn't apply to anything provided that there is no rent credit offered and I'm collecting the difference between the rental amounts? Has anyone dealt with this?

He told me that it was recommended to him to structure it with a land contract which involves him borrowing private money and then refinancing.