http://www.leasepurchaseagreementmadeeasy.com - Using a lease purchase agreement is a fairly common real estate transaction. They are most often used when you have a true buyer for your house that just requires some time before they can close on the purchase of the property. However, this is ... More

http://www.leasepurchaseagreem
entmadeeasy.com - Using a lease purchase agreement is a fairly common real estate transaction. They are most often used when you have a true buyer for your house that just requires some time before they can close on the purchase of the property. However, this is not the only type of situation where a lease purchase would be the best type of transaction to structure in order to meet the objectives of both the seller and the buyer. The term (length) of the agreement is clearly laid out and agreed to in writing (on the forms: http://www.leasepurchaseagreem
entmadeeasy.com ) before the buyer gives the seller a deposit and moves into the property. Most sellers prefer to get a pretty good size deposit to confirm that they are dealing with a genuine buyer. A typical time frame for closing is anywhere from a few months to a year. They can be used to structure longer term deals. However, if the initial term of the agreement is going to be over 36 months, a different type of contract should probably be considered. A lease option would probably be a better choice if you have a tenant that simply wants the option and not the obligation to buy the property. With a lease purchase you and the buyer are actually going to draft a real estate contract with a set closing date anywhere from a few months to a couple of years out. The time-frame agreed to should be carefully considered by both parties before the documents are signed and fully executed. Naturally, the buyer is allowed to close on the purchase sooner if things work out that way. Obviously any type of contract, including real estate agreements, can be renegotiated if all the parties involved agree and the lease purchase form does allow for a one-time extension of the closing date under certain terms and conditions. However, things typically go better if all parties have a clear expectation of when the actual transfer of the real estate title and full payment to the seller will happen. Often the buyer is already working with a mortgage broker and has a pretty good idea of when they will be able to get the loan to close on the purchase. Before moving into the property the buyer will make a purchase deposit (not an option deposit). The lease purchase agreement will be attached and have supremacy over the real estate contract. If the buyer defaults on any of the terms of the agreement, you will typically have the right to eject them from the property and keep their deposit. Obviously that would be a worst-case scenario. Ideally, they will rent the house for a few months and then close on their contract. Less

jeffhollyhand

Added Feb 20, 2011  

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