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What is a Lease Option?
In today's market, buyers and renters have options due to the amount of properties on the local MLS.

If you do not have a down payment to purchase a home or condo or lack a sufficient credit score you may want to consider a Lease to Own contract.

This will give you the flexibility to make a slightly higher monthly payment and a portion of your rent goes to your down payment on the home or condo.  This means after a set period of time you will have saved enough for the down payment and you have the option to execute the sale at a preset sales price.

  1. Agree with the seller on a purchase price.
  2. Agree on the term of the lease. This will be the maximum length of time you want the opportunity to exercise your option to buy.
  3. Determine a market value for your monthly rent. (This is the amount a person would pay to simply rent the property.) Then add $25 to $200 per month to be applied toward the future down payment of the home. (This is not a requirement, but it helps you accumulate money for a down payment.)
  4. Agree upon terms regarding the exercise of the option, such as the escrow period and financing.
  5. Determine who will pay for inspections, work and warranties when the time comes to complete the purchase.
  6. Go to your local Board of Realtors Association or real estate company and purchase a lease-option agreement form.
  7. Handle the transaction as a lease until you are ready to exercise the option.
  8. Exercise the option in writing.
  9. Open escrow or contact a real estate attorney to handle the transaction.

Sound good or have questions?

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