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Identify the property covered by the lease. List the parties to the agreement. Set the length of time the agreement will be in effect. Specify the rent to be paid and when it is due. State the amount of any deposits or fees. Describe the consequences of late payment.
In a standard Lease-Purchase Contract, the two parties agree to a lease period during which rent is paid, and the terms of the sale at the end of the lease period, including sale price. Often, the contract is structured in two parts, one representing the lease term and the other a contract of sale.
A lease option is different from a lease purchase contract, in that a lease purchase binds both parties to the sale, whereas in a lease-option the buyer has the option, but the seller does not.
A lease-option-to-buy arrangement can be a solution for some potential homebuyers, but it's not right for everyone. If you're not certain that you're going to be able to purchase the rental home at the end of the lease period, you might be better served with a standard rental agreement.
Rent-to-own is when a tenant signs a rental agreement or lease that has an option to buy the house or condo later usually within three years. The renter's monthly payments will include rent payments and additional payments that will go towards a down payment for purchasing the home.
A lease-option is a contract in which a landlord and tenant agree that, at the end of a specified period, the renter can buy the property. The tenant pays an up-front option fee and an additional amount each month that goes toward the eventual down payment.
A lease to purchase agreement is a home rental lease that includes an option for the renter to purchase the home during the term of the lease contract. The contract specifies the purchase price of the home, and in exchange for the purchase option, the renter pays an upfront deposit.
A lease-option allows the seller to sell a property that they may not have otherwise been able to sell. In many cases a seller can net more money when offering terms to a buyer. Sellers can often avoid paying a Realtor fee by using a lease-option agreement (as they have already found the buyer themselves).
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