When you lease a car, you’ll be given an option at the end of the rental term to buy it or move on to a new vehicle.

It works great for car owners, so why not apply this principle to homeownership?

Investors certainly seem to think there’s something to the concept. A number of startups in the lease-to-own, or rent-to-own, category have been catching the attention of big players like Sequoia Capital, Jay-Z’s venture capital arm of Roc Nation, the National Association of Realtors’ Second Century Ventures and Google Ventures.

Two companies, Landis and Divvy Homes, have raised tens of millions of dollars in funding over the last year. And another big name in the sector, Home Partners of America, was acquired by alternative investment firm Blackstone last year for $6 billion.

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Lease-to-own agreements allow prospective homebuyers to rent and live in houses they’d one day like to buy. While you’re renting, you’ll pay a little extra every month that can be used as your down payment once the rental term is up.

This buying model is marketed as a way to transition to homeownership without having to clear the hurdle of affording a down payment.

But the closer you look at this arrangement, the more cracks begin to show.

What are lease-to-own or rent-to-own homes?

With a lease-to-own contract, you can chip away at your down payment over time, rather than having to have it in cash upfront. And your down payment installments help build equity in the home before you’re the official owner.

And if you’ve had financial struggles in the past, you’ll also eke out a little more time to get your finances in good shape, like improving your credit score, so you can qualify for a better rate on your mortgage.