Lease with Option to Buy

[Tanya in KS]

Has anyone ever done a Lease with Option to Buy on a home? Wondering how to get this done? What were the pros/cons?

 

Thanks in advance!

[MotherMayI]

We are doing this right now. The house was listed for sale or lease option. The seller lowered the price by about $20,000 in hopes to find an outright buyer- their preference was of course to sell...not lease/option. We recently started a business and are not in a position to purchase outright so we started working with the realtor. In the end we bid at the original price- another buyer (not lease/option) bid lower than the reduced amount and the seller selected us. We put down a sizeable down payment (that we will lose if the deal falls through). Our contract is for up to 2 years and a portion of our lease money goes toward the purchase. Our lease agreement allows us to remodel the house as we see fit (no structural changes) and the seller has to provide monthly proof that our payment directly went toward their mortgage payment. We had a lawyer look at the agreement and felt comfortable in going forward after his advice. We had heard horror stories about buyers losing their down payment and additional money because the sellers went bankrupt. We have only been here about a month, but we are treating this home as if we own it already. We have made several changes that we would not have done had we been renting.

 

Hth!

[....]

:iagree:with getting an attorney to help you approve a contract in this situation.

 

I would be very, very careful. I'm actually not a fan of lease-to-own because not only have I heard horror stories also, but when it comes time to mortgage the house and officially buy the property, you're going to feel backed into a corner. There's not going to be much negotiation because the seller knows that you're already in there and probably are dead-set on staying. If anything goes wrong during price negotiation or the inspection, it's going to be harder for you to walk away.

 

I would just be very careful. Make sure you are willing to leave that situation if necessary. I have seen so many rip-off situations with buying/selling houses. You've really gotta look out for yourself.

 

Oh, and there is NOTHING wrong with renting, so take your time and do what's best for you...:D We're renting right now and our savings account is growing astronomically. If we would've bought a house, we would have blown all that money on all kinds of *&%^$.