Lease Option

Lease Option for Real Estate

While using a lease option is a long established practice of rent-to-own (between landlords and tenants), the lease purchase agreement has become the preferred method of sellers working with real buyers.

Click Here To Get a Lease Purchase Agreement For $9.97

A Lease Purchase Agreement is designed to allow a buyer to rent the property until the closing date they have agree to in the real estate contract.

A Lease Option is designed to allow a tenant to choose whether or not to purchase the house, but it obligates the landlord to sell if the option is exercised. Many landlords like the lease option method and have been using it for decades but most sellers prefer a lease purchase agreement.

Sellers can typically demand a larger non-refundable deposit with a lease purchase because they are dealing with someone that truly wants to purchase the property. Obviously a lease purchase buyer can run into problems and end up not purchasing the property, but their intent when entering into the agreement is to purchase the property.

Below is a sample lease option agreement.
As you can see a lease option is really for a tenant that may (or may not) want to purchase the property.

 

The form below is not a lease purchase agreement.

It is an example of a lease option.


 LEASE OPTION

 

 

Tenant(s)                                                                                                                                                                    

 

Property                                                                                                                                                                     

 

Landlord                                                                                                                                                                    

 

Landlord's Address                                                                                                                                                    

 

1)      TERM:  This lease shall begin on ________________________ and end on _________________________.

 

2)      RENT:  The rental amount is $                                          and is due in advance by the first (1st) day of each month.

 

3)      RETURNED CHECKS:  A $                                          returned check fee shall be charged for each check rejected/dishonored by the financial institution for any reason. Returned checks shall be considered unpaid rent and shall be subject to a late fee, as well.

 

4)      LATE FEE:  If rent is not paid by the fifth (5th) of the month, there is a $                                         late fee.      This fee will be charged in addition to any other charges (such as a returned check fee, etc.).

 

NOTE: Landlord may deliver/serve notice to “pay rent or quit” at the earliest date allowed by law.

 

5)      TERMINATION:  In addition to reasons declared by law and/or stated elsewhere in this agreement, the landlord may terminate this agreement under the following circumstances:

a)      Any illegal activity at the property.

b)      Any harassment, threats or intimidation made towards Landlord, or in the presence of Landlord.

c)      Any other extreme situation that a court could reasonably rule as grounds for immediate termination.

 

6)      EVICTION:  If the Tenant is in breach of this agreement, the Landlord may start the eviction process at the earliest date allowed by law.

 

7)      SERVICE-OF-NOTICE:  Unless prohibited by statute, the following will be considered adequate service-of-notice:

a)      Delivery Confirmation or equivalent via the United States Postal Service.

b)      If delivery to property by mail is not possible or practical, Landlord may attach notice in a secure manner to the entrance of the property.  

 

8)      OPTION-TO-PURCHASE:  Tenant has the option to purchase property during the term of the lease, subject to the following:

 

a)      Price: $                                                                       

b)      If the Tenant purchases the property, the Security Deposit will be created to the Tenant’s down payment.

c)      Property will be purchased in “AS IS” condition, without recourse.

d)     Tenant will pay all cost associated with the closing of this transaction.

e)      This option will become null and void when this agreement had expired or been terminated.

 

9)      OPTION CONSIDERATION:  Tenant has inspected property and found it to be in satisfactory condition.  As consideration for the option-to-purchase the property, Tenant will perform all maintenance and repairs, unless prohibited by statute.

 

10)  INSURANCE:  It is strongly recommended that Tenant carry “Renter’s Insurance”, as Landlord’s insurance will not cover Tenant's belongings/possessions.

 

11)  ALTERATIONS AND IMPROVEMENTS:  Tenant shall make no alterations or improvements without the written consent of the Landlord.  This includes (but is not limited to) paint and wallpaper.  Any such alterations or improvements shall become the property of the Landlord unless otherwise agreed in writing.

 

12)  SECURITY DEPOSIT:  Landlord acknowledges receipt of a $                                                  security deposit.  Tenant can not use security deposit as last (or any) month’s rent or any other charge/fee. Tenant agrees and understands that the security deposit is intended for damages and other charges discovered after the termination of tenancy and that any expenses incurred by the Tenant during the term of this agreement should be paid at the time of occurrence. Security deposit will be returned to Tenant within 30 days (unless otherwise declared by statute) of Tenant vacating. Landlord will include a detailed list of any deductions from the security deposit.

 

13)  LANDLORD’S ACCESS:   The Landlord has the right to access the property (enter the residence) at reasonable hours for the purpose of inspection or repair. The Landlord shall give 48 hours notice (unless otherwise declared by statute), except in the event of an emergency.

 

14)  ASSIGNMENT:  Tenant may not assign or transfer this agreement or any interest herein.

 

15)  SUBLETTING:  Tenant may not sublet or re-rent the property or any part thereof.

 

16)  FAILURE TO INSIST UPON STRICT PERFORMANCE:  Landlord does not give up rights. If Landlord fails to enforce any clauses in this agreement, Landlord may enforce these clauses at a later time without penalty.

 

17)  JOINTLY AND SEVERALLY: If there is more than one Tenant, the Tenants are jointly and severally liable under the terms of this agreement.

 

18)  SEVERABILITY:  In the event that any part of this agreement is found by any court of competent jurisdiction to be invalid, the remainder of this agreement shall remain in full force and effect.

 

 

Tenant                                                                                                             Date                                                   

 

 

Tenant                                                                                                             Date                                                   

 

 

Landlord                                                                                                         Date                                                   

 


The form above is not a lease purchase agreement.

It is an example of a lease option.

Click Here To Get a Lease Purchase Agreement For $9.97

 

 

This website is designed to provide accurate information regarding the subject matter covered; however neither the
publisher nor contributors assume any responsibility for errors, inaccuracies or omissions. If you need legal

 or other professional advice the services of a competent professional should be sought.

 

Lease Purchase Agreement

Privacy Policy