Hidden Risks of Buying a House via Direct Installments from the Owner

Here's the English translation of the conversation:

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AG 🐮: Hey Ex, if a customer is buying a house through direct installment payments with the owner, can the owner mortgage/sell with buy-back terms or use the property as collateral while the customer is still paying?

Ex 🐻: Of course! The ownership rights still belong to the homeowner, not the person paying in installments.

AG 🐮: Wait, what!? What if the owner doesn’t redeem it?

Ex 🐻: That’s exactly the problem! 🦎🤣🤣

AG 🐮: So the buyer is basically taking on all the risk?

Ex 🐻: Exactly!! Or, say while the installments are still ongoing, the owner gets into debt and is sued, and the property is seized—if the court enforcement sees the property being paid in installments, it can still be seized to settle the debt. They don’t care that the house is under a rent-to-own contract.

AG 🐮: Then can we register the rent-to-own contract with the Land Department to prevent the owner from mortgaging or selling the property with buy-back terms?

Ex 🐻: Nope! The officers can't register something like that.

AG 🐮: What if we register it as a long-term lease instead?

Ex 🐻: That only grants tenancy rights. It just guarantees the lessee can stay until the end of the lease, even if the ownership changes hands. But it doesn’t mean the lessee becomes the owner, nor does it stop the current owner from mortgaging or selling it.

AG 🐮: Then what’s the best way to go about direct installment purchases?

Ex 🐻: Honestly? Best to get your finances in order and apply for a loan through a proper financial institution. But if you really can’t—if you must have that house, right now, this instant—then be sure to agree on clear terms and draft a solid contract. Get a responsible agent to represent the buyer’s interests and ask the tough questions. Don’t just focus on closing the sale, then disappear when problems arise. Direct installment deals still aren’t clearly protected under specific laws. It’s more like a creative workaround to create liquidity in buying and selling.

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The direct installment method still comes with a lot of risks.
Most people who choose this route usually do so because:

• Their financial status isn’t strong
• Their income isn’t officially documented

So, before entering a rent-to-own agreement:
Make sure the seller is trustworthy
And operates with integrity in their business.

It’s not recommended—but not outright discouraged either.
If you really want to go the rent-to-own route,
You must be willing to accept these risks.
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