« « Buying a House through Lease Options (2)

Buying a House through Lease Options (3)

Important items you want clearly indicated in any lease option are:

  • The time frame, with both beginning and ending dates
  • What happens to the deposit if you don’t buy the home
  • If any of the monthly payments will be credited toward the purchase price
  • How repairs and improvements to the house will be handled— who pays for what during the lease period
  • Whether the selling price is set at the beginning of the option or is determined at the end by a certified appraisal

In most instances, if you don’t buy the home within the option period, you lose the deposit and any money you have spent on home improvements. When negotiating a lease option in a buyer’s market, insist on determining the selling price by a certified appraisal when you exercise the option. It’s likely the value will have dropped during the lease period.

The biggest reason many lease options fail or run into trouble is because the proper paperwork wasn’t done in the beginning. Everything must be spelled out in writing. Take the same precautions as discussed in the section on seller financing, and hire an attorney to look over the paperwork.

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