Lease Options
Lease options refer to an agreement in which a property owner signs a lease agreement with a willing lessee to have the property rented out but with the aim of selling it off eventually to the lessee. The renting period is normally one year, the time during which the seller will have received a down payment and several monthly payments from the buyer.
This type of agreement is a mid-point between renting and buying. The advantage is that the buyer gets to buy property, not on hire purchase but on a payment plan that allows him to back out if he feels he does not want to buy the property anymore. In addition, this arrangement allows him more time to decide if the house or property is right for them or not, as well as calculate if they will be able to afford it.
Once the value of the house has been calculated, this is the amount the buyer will be expected to pay, regardless of whether the value appreciates or depreciates. However, the buyer has the option of quitting if the value depreciates and he feels that he is buying it at a much higher price than he should. The bad thing with quitting is that he will have to forfeit all the monies paid in advance.
As a buyer, if you want to be on the safe side, always have a lease option lawyer before signing any agreement. This way, you will be able to explore all the options and eliminate bad risks. Note that many of the houses that are sold in this rental basis have been in the market for a long time and the lessors are out to explore other options that might give them fast cash. Be informed thoroughly in advance.
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