Renting a furnace in Ontario: What You Need To Know

Are you considering renting a furnace in Ontario? While furnace rentals can be a convenient option, there are a few things you should know before making a decision.

Does renting a furnace save you money?

Renting a furnace may not necessarily save you money in the long run. While the monthly cost of renting a furnace may be lower than the upfront cost of purchasing a furnace, over the course of a typical 12-15 year rental contract, the total cost of renting a furnace can end up being significantly more expensive than buying a furnace outright. This is because the monthly rental fee does not go towards paying off the furnace and homeowners do not own the furnace at the end of the contract. Instead, they must either renew the lease, pay a buyout fee to purchase the furnace, or pay a removal fee to have the furnace removed from their home. It is important for homeowners to consider these factors and carefully weigh the costs and benefits before deciding whether to rent or purchase a furnace.

Is renting a furnace the same as rent-to-own?

No, renting a furnace is not the same as rent-to-own. When you rent a furnace, you pay a monthly fee to use the furnace in your home, but the furnace remains the property of the rental company. You do not have the option to eventually own the furnace, and at the end of the rental contract, you must either renew the lease, pay a buyout fee to purchase the furnace, or pay a removal fee to have the furnace removed from your home.

On the other hand, a rent-to-own agreement allows you to rent a product with the option to purchase it at the end of the rental period. With a rent-to-own agreement, you typically make monthly payments that go towards both the cost of renting the product and the eventual purchase price. At the end of the rental period, you can choose to buy the product or return it. Rent-to-own agreements are often used for furniture, appliances, and electronics, but they may also be available for other products such as cars and houses.

Is Your Choice of Service Provider Limited When Renting a Furnace?

It depends on the terms of the rental contract. Some furnace rental contracts may specify that you must use the rental company’s service providers for any repairs or maintenance on the furnace. In such cases, you may not have the choice of service provider and may be required to use the company specified in the contract. Other furnace rental contracts may allow you to use any service provider you choose, as long as the work is done in accordance with the terms of the contract. It is important to carefully read and understand the terms of a furnace rental contract before signing, to ensure that you are aware of any restrictions on your choice of service provider.

It is possible that renting a furnace could make it more difficult to sell your home. This is because prospective buyers may be hesitant to assume a long-term rental contract for a furnace. They may prefer to purchase their own furnace or negotiate a different arrangement with the seller. Additionally, if the terms of the rental contract require the furnace to be removed from the home at the end of the rental period, this could be a drawback for buyers. It is important to consider these factors and how they may affect the appeal of your home to potential buyers before deciding to rent a furnace.

Does a Furnace Rental Contract Affect the Sale of a Home?

It is possible that renting a furnace could make it more difficult to sell your home. This is because prospective buyers may be hesitant to assume a long-term rental contract for a furnace. They may prefer to purchase their own furnace or negotiate a different arrangement with the seller. Additionally, if the terms of the rental contract require the furnace to be removed from the home at the end of the rental period, this could be a drawback for buyers. It is important to consider these factors and how they may affect the appeal of your home to potential buyers before deciding to rent a furnace.

How Does Renting a Furnace Affect Your Home Equity?

Renting a furnace may not have a direct impact on your home equity. Home equity is the portion of your home that you own outright, or the difference between the value of your home and the amount you still owe on your mortgage. Renting a furnace would not affect your home equity unless you included the cost of the rental in your mortgage, in which case it could affect your loan-to-value ratio.

However, there are other ways that renting a furnace could indirectly impact your home equity. For example, if the cost of renting a furnace is significantly higher than the cost of purchasing a furnace outright, it could affect your ability to save money and build equity through mortgage payments. Additionally, if renting a furnace makes it more difficult to sell your home, it could reduce the value of your home and thus your home equity. It is important to consider these factors when deciding whether to rent or purchase a furnace.

Why is renting a furnace common in Ontario?

There are a few reasons why furnace rentals may be common in Ontario:

1. Low upfront cost: The initial cost of purchasing a new furnace can be expensive, especially for top-of-the-line models with advanced features. Renting a furnace allows homeowners to obtain a new furnace without having to pay the full purchase price upfront.
2. Cost certainty: Furnace rental contracts often include maintenance and repair services, which can provide homeowners with cost certainty and peace of mind.
3. Lack of upfront capital: Some homeowners may not have the upfront capital to purchase a new furnace, and renting a furnace allows them to obtain the equipment they need without having to pay the full purchase price upfront.
4. Short-term living arrangements: If homeowners plan to move within a few years, they may prefer to rent a furnace rather than purchase one, as they will not be in the home long enough to justify the upfront cost of purchasing a furnace.
5. Limited credit options: Some homeowners may not qualify for financing to purchase a furnace, and may choose to rent instead.

These are just a few potential reasons why furnace rentals may be common in Ontario. It is important for homeowners to carefully consider their own circumstances and weigh the costs and benefits of renting versus purchasing a furnace before making a decision.

Other considerations when renting a furnace:

When considering whether to rent a furnace in Ontario, there are several other factors to take into account beyond the upfront cost. In this section, we will examine some of the other considerations that homeowners should keep in mind when deciding whether to rent a furnace.

Monthly Fees

First and foremost, it’s important to understand that furnace rentals typically come with a monthly fee. This fee can vary depending on the size and efficiency of the furnace, as well as the length of the rental agreement. In some cases, the monthly fee for a furnace rental may be higher than the monthly payments for a financed furnace purchase. It’s important to carefully consider the long-term costs of a furnace rental before making a decision.

Always Check Rental Agreement Terms

Another thing to consider is the terms of the rental agreement. Make sure to read the agreement carefully and understand what is included in the monthly fee. Some rental agreements may include maintenance and repairs, while others may not. It’s also a good idea to find out what happens if you decide to terminate the rental agreement early.

Installation and Maintenance Requirements

It’s also worth noting that, in some cases, furnace rentals may come with stricter installation and maintenance requirements. For example, the furnace may need to be installed by a technician approved by the rental company, and certain maintenance tasks may need to be performed by the company as well. Make sure to fully understand these requirements before committing to a furnace rental.

Alternatives to Renting a Furnace in Ontario

At Airpoint, we believe that owning your own home comfort assets is the best option for Toronto homeowners. It adds equity to your home, saves money in the long run, and gives you the freedom to choose your own service providers.

However, we understand that purchasing a new furnace can be a significant expense, and not everyone has the upfront capital to do so. That’s why we offer “Finance-it”, our flexible financing program that allows homeowners to spread the cost of a new furnace over time. With “Finance-it”, you won’t be locked into a long-term rental contract with an expensive buyout at the end. Instead, you’ll have the option to finance your furnace and make monthly payments that fit your budget.

If you’re interested in learning more about our financing program, “Finance-it” and how it can help you upgrade your home’s heating system, don’t hesitate to give us a call at 905-597-4933 or contact us online. Our team is always happy to answer your questions and help you explore your options.

Conclusion

In conclusion, it is important for homeowners in Ontario to carefully consider the costs and benefits of renting versus purchasing a furnace before making a decision. While renting a furnace may seem like a more affordable option upfront, it can end up costing significantly more in the long term and may have other drawbacks such as limiting your choice of service provider and affecting the sale of your home. It is essential to thoroughly research and understand the terms of any furnace rental contract before signing, and to weigh all of the costs and benefits before making a decision.

More Frequently Asked Questions for Renting A Furnace In Ontario