I just came across this post on a Linkedin Manufactured Home discussion group contribute to. RE professionals may want to rethink any advice they are giving their clients or on public forums such as this. I'm sure this applies to any lease/rent to own real estate transactions:
"MH Community Fined Over Rent-to-Own
The Pennsylvania Department of Banking and Securities determined that Cumberland Valley Investments, Inc. d/b/a New Oxford Mobile Homes was engaging in unlicensed activity when they entered into rent-to-own contracts with consumers.
I have been telling people for several years now that Rent-to-own and Lease-to-Own contracts are treated the same as installment sales contracts in most states. They create a security interest in property, the same as a mortgage, and proper mortgage licenses are needed when originating installment sales contracts.
As such, while there is no legal prohibition against doing Rent-to-Own and Lease-to-Own, there are requirements to do so, including having the proper lending licenses, an MLO on staff, and full compliance with state and federal requirements that requires a properly trained Compliance Officer and a full Compliance Management System.
Cumberland Valley Investments, Inc. was fined and required to obtain the proper licenses as required by the Mortgage Licensing Act. The state was more lenient that the CFPB would have been, so they were lucky. At least they are still in business."