A Guide on Rent-to-Own in Edmonton: How It Works

Aug 18, 2023

Can Rent-to-Own be a Solution to Buy a Home in Edmonton?

Are you ready to turn your goal of owning a home in Edmonton into a reality? Even with all the media surrounding housing, the goal of homeownership could be more achievable than you think with the option of rent-to-own. In this guide, we'll take you through the process step by step, highlighting essential details that you need to know, including:


  1. What's involved
  2. Roles and responsibilities
  3. Mortgage qualification


Plus, we'll end off this guide with a quick look at some of our favourite Edmonton neighbourhoods that we see still maintaining their affordability.

Making a Commitment to Your Future

The journey to homeownership through rent-to-own starts with a fundamental element: commitment. Just like regular homeownership, you're making a big decision that you're going to be sticking by for many years to come.   

Future homeowners who work with us at Chilkoot Homes need to have a minimum of $10,000 or 3.5% upfront that goes toward your future purchase of the home. This initial amount that you put in signifies your determination to become a homeowner and gives us peace-of-mind (especially considering we'll have to put a minimum of 20% down – sometimes over $100,000 – to purchase the property for you at the outset). 

You'll also have to consider, just like any rent-to-own program, that there is going to be two portions of your monthly payment: a portion that goes toward your rent, and a portion that goes toward your future purchase. There are also costs like internet and utilities that you have to make sure you can comfortably afford. 

Of course, once you own the house at the end of the rent-to-own program you'll be responsible for the costs of homeownership: mortgage principal and interest, insurance, taxes, utilities, and repairs. Part of the work we do with you throughout the rent-to-own program is getting you into the right financial habits so that you can easily handle the full costs of owning a home when it comes time for you to own it outright. 

However, commitment in a rent-to-own context goes beyond mere financials. By engaging in a rent-to-own agreement, you're essentially agreeing to purchase the property at a later date because you're unable to qualify for a traditional mortgage right now. This commitment is through an "Option to Purchase" contract. In simple terms, this contract grants you the option to buy the property at a predetermined price by a specific date in the future. This flexibility ensures that you can decide based on your evolving circumstances.

Lastly, you are making a commitment to your financial future. A part of our requirements when we work with our future homeowners is that they are agreeing to building their financial literacy skills to create a better financial future for themselves and their families. 

Roles & Responsibilities

Like we mentioned above, your financial future is incredibly important to us. It's also important so that you can qualify for your own mortgage at the end of the rent-to-own term, within 2-4 years. Because of this, there are specific responsibilities that our clients have when working with us:


  1. Quarterly check-ins with a Chilkoot Homes rent-to-own specialist
  2. Twice yearly budgeting reviews so that you become a successful budgeter (and realize the positive impacts it can have in your life!) 
  3. Annual check-ins with your Homeowner Pros


Although our service is all about making you a homeowner, our mission is about empowering you with financial literacy skills that you'll use for a lifetime and pass down to your kids. Through this process we hope to teach you more about credit, budgeting, mortgages, and to help demystify the complex world of finance. 


An appealing part of our rent-to-own program, and something that makes us different, is that you will get to shop for your future home on the open market. This means that you can go onto Realtor.ca and shop for a home with a real estate agent, getting the full experience of buying a house!


Our responsibility is making sure that you are successful, and we take every measure possible to do that.  This includes many things that we do in the background like:


  1. Financing the house at the beginning of the program so we can buy the house for you
  2. Reporting your on-time payments to help boost your credit score
  3. Paying the mortgage, insurance, and taxes


The reason why folks like you work with us is that they are unable to qualify for a mortgage from a bank. We work with you to ensure certain qualifying factors are in order for you to get your own mortgage by the end of the rent-to-own term. These factors include your income, job history, credit score, and debt service ratio.


Chilkoot Homes is committed to guiding you through this process to set you on a trajectory that transitions you to homeownership.

Your Path to Mortgage Readiness

Understanding the components that lenders evaluate for mortgage approval can demystify the process and empower you to take actionable steps. This is a part of the work we do with our clients to get them set up for success in a rent-to-own program.


Here's a brief overview of what lenders generally look at when deciding whether or not you get a mortgage.


  1. Income: A consistent and stable income is a cornerstone of mortgage qualification. In Canada, you'll generally need at least 2 years of steady income history in the same industry.  That means, even if you've been working for the last 10 years straight, but 6 months ago decided to switch from nursing to business admin, you wouldn't qualify
  2. Credit Score: A strong credit score speaks volumes about your creditworthiness, especially now where your credit score is the only way a lender "gets to know you." You'll generally need a credit score of at least 680 to qualify for a mortgage.
  3. Debt Service Ratio: This ratio measures your ability to pay your debt. Regardless of how much you make per year, if you're holding too much debt, you are likely to be declined for a mortgage (talk to us about this to hear our story on how we had to qualify for our first mortgage!)
  4. Down Payment: This down payment is how much money you need to put in up front to purchase the house. The minimum down payment is going to range between 5%-20%. A lot of factors play into how much you'll need to put as a down payment, but the absolute minimum is 5% (and if putting a down payment less than 20%, you'll be required to purchase mortgage insurance).


There may be solutions you can explore other than rent-to-own, but if you're ever in doubt we're happy to have a call with you to answer your questions. You can book a free discovery call with us here.

Edmonton Neighbourhoods we Love

As you embark on this enriching journey toward homeownership, it can be fun to start exploring some areas in Edmonton that balance affordability with being great neighbourhoods. Here are a few worth considering:


  1. Strathcona: Known for its eclectic mix of historic charm and modern flair, Strathcona boasts a lively atmosphere with trendy boutiques, inviting cafes, and a close-knit community spirit. Its walkable streets and proximity to local attractions make it a sought-after destination for those seeking a vibrant urban experience.
  2. Highlands: Lined with tree-shaded streets and historic homes, Highlands offers a tranquil retreat from the urban bustle. Its close proximity to the lush River Valley and strategic transit access make it an ideal haven for those seeking both natural serenity and convenient city connections.
  3. Queen Alexandra: Boasting a rich cultural tapestry, this area is known for its variety of housing options and lively community events. With its convenient location and unique character, Queen Alexandra stands as a testament to the city's inclusive spirit and welcoming atmosphere.


As you consider rent-to-own homes in Edmonton, we hope this guide could provide you a brief overview of the things you'll need to consider. With Chilkoot Homes as your companion, you'll traverse this journey with the tools, skills, and assurance you need to achieve your goal of becoming a homeowner.



Disclaimer: The information provided in this article is for general informational purposes only and does not constitute financial, legal, or professional advice. Consult with a qualified financial or legal professional before making any decisions related to rent-to-own agreements or property purchases.

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