Lease Option FAQ

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  1. What is Lease Option

    – Lease Option is owners are leasing or renting a property with an option tobuy it at a future date. The future price of the property should be fixed at aperiod of time where the lease-option agreement is signed.

  2. How does the price fix?

    – The price is fix with a set price , whereby agreed between the leaser and the owner atthe beginning of the lease period. Normally is about 10% increment per annumfrom the current market value.

  3. How long is a typical lease?

    – The leaseperiod is either 3 years or 5 years.

  4. What arethe features and benefits of Lease Option?

    – If you’rea buyer, you will have minimum cash out of pocket, financial credit problem isnot a major issue, faster equity growth, increased buying power, and peace ofmind.

    – If you’rethe seller, positive cash flow, large market buyers, minimum risk, nomaintenance, and a non refundable deposit.

  5. How muchshould I charge for an option deposit?

    – Ideallyoption deposit is between 1-3% of the proposed purchase price.  Although it will all depend on the agreementboth party will agree into.

  6. Who is responsible for the household repairs?

    – The monthly lease payments will act asmortgage monthly repayment which will pay direct to owner’s loan account.

  7. Who receives monthly lease payments?

    – The monthly lease payments will act asmortgage monthly repayment which will pay direct to owner’s loan account.

  8. What if the leaser doesn’t exercise theiroption to purchase?

    – If the leaser decides to leave the property, all the fees that they have paid are forfeited.

    – If the leaser decides to extend the lease period, is it owner best interest to whether continue to lease the unit or find a new leaser.

    i. All the fees that leaser have paid are notforfeited if the owner decides to extend the least period.

    ii. All the fees that leaser have paid are forfeited if the owner decides not to extend the lease period.

  9. What if Ihave bad credit payment records?

    – Our panel financing agency will give you a credit analysis and recommendation to recover your credit status.

  10. Whocarries the property fire insurance?

    – Theproperty fire insurance of the home is carried by the owner.