- First, the Tenant-Buyer signs the 12 month Lease Option.
This is where you grant him the right to purchase the property
in 12 months and where he agrees to pay your asking price.
- We use either the California
Association of Realtors® “Lease and Option to Purchase
Agreements” or our own Standard Agreements.
- Once the Lease
Option Agreement is signed by the Tenant-Buyer we collect our fee from
him and we assign the agreement to you.
(You pay no fees—none whatsoever.)
- Next, the
Tenant-Buyer will give you a security deposit and then pay your
monthly lease amount. He
will continue paying the monthly lease until either he exercises his
option to purchase or until the lease term expires.
- If the
to extend the Lease Option beyond the
first 12 month term:
will pay you a 5%
increase in Monthly rent; and
- The price of his
purchase option will be increased by the greater
of the following:
- 5% of
the purchase price, or,
- 50% of the percentage
increase in the value of the average homes in the zip code where
your home is located; and
will pay an additional 1% to 2% of the new Option Price.
amount will be applied toward the purchase price of the property
if the Tenant-Buyer exercises his option to purchase.
- In the event that
he does not exercise his option, you can keep this
money, because it is non-refundable.