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This is a method for the buyer to secure the property for future purchase while living in it. This method also has other benefits for both seller and buyer.
Basics of a Lease Option
• Buyer pays the seller option money for the right to later purchase the property. The lease option money may be used as a part of the down payment .
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• Buyer and seller agree to a purchase price at the time of signing of the contract.
• During the term of the lease/option, the buyer agrees to lease the property from the seller for a predetermined rental amount.
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• The term of the lease option agreement is negotiable, but the common length is generally from one year to three years.
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• Seller pays taxes and insurance - and any repairs over $500.00.
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• A portion of the monthly rental payment applies toward the purchase price.
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• Option money is not refundable.
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• Nobody else can buy the property during the lease/option period.
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• The buyer cannot assign the lease option without seller approval.
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• If the buyer does not exercise the lease option and purchase the property at the end of the lease option, the option expires.
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• The buyer is not obligated to buy the property.
This document will be notorized and then recorded with the county to protect all parties to the aggreement. .
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