Lease to option homes have gained popularity in the real estate market because it offers several benefits to both the seller and the buyer of the property. Typically a seller who is not in need of the money and wants to move out of the house quickly offers this deal to someone who needs a house but has some financial issues. Though the benefits are clear, as the buyer you should consider the following considerations before you venture into this kind of agreement.
As the buyer you should know why the seller is selling his/her house. There may be some tax or loan issues with the seller. Hence, one the contract is signed and you were not able to check on this one, all the necessary obligation may fall unto you. Before signing the contract, be sure if you really want to avail this agreement because you are to pay a much higher rental fee because of the additional payment- to be used as a down payment for the potential purchase of the house. Also “option money”, that is 3-5% of the price of the house is to be paid before you move into the place. All of the money paid is non-refundable even if you wish not to buy the house anymore. Hence, once the contract is signed, you are amenable with paying all the necessary fees and should you wish not to avail the house, the owner is not liable for returning anything to you.
After signing the contract and finally moving into the place, you are still given the time to decide if you are really interested with the property. During the time of your stay, be efficient enough to look around the area. Check if the location is safe and ideal for you and your family. Since this will be you future neighborhood, the place should be best for you and your family to grow.
A lease option is different with a “lease to own/rent to own” agreement. The first entitles a person to opt to buy the house at the date specified in the contract while the latter obliges you to purchase the house at the date specified in the contract. Hence, if you have a lease option agreement with the seller, you can still “opt” not to avail the house if you think that the area or the house is not good enough for you.
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