Lease options, rent to buy agreements?

[34f3f3f]

I’m not clear whether these are one and the same, but would be interested to know if anyone has experience of this type of arrangement. Basically, it involves renting from an owner with an option to buy at some later date. This would seem to satisfy both sellers who are waiting for prices to recover, and fence sitters who anticipate the reverse. A bet if you will. I’m assuming demand since this stand-off has been talked about so often. But I’m guessing not many are aware of this option.

[patb]

lease to purchase is usuaaaly a mechanism for people who lack a down payment.

The lessee gets Credit on the rent towards a strike price.

[patb]

lease to purchase is usuaaaly a mechanism for people who lack a down payment.

The lessee gets Credit on the rent towards a strike price.

[patb]

lease to purchase is usuaaaly a mechanism for people who lack a down payment.

The lessee gets Credit on the rent towards a strike price.

[patb]

lease to purchase is usuaaaly a mechanism for people who lack a down payment.

The lessee gets Credit on the rent towards a strike price.

[patb]

lease to purchase is usuaaaly a mechanism for people who lack a down payment.

The lessee gets Credit on the rent towards a strike price.

[SD Realtor]

Basically lease options are heavy favorites for the sellers. It is a good way to make money because the odds are VERY substantial that the buyer does not exercise the option. Similarly there are always complexities with the pricing and appraisal valuation because none of them can be really decided until the option is exercised. If the seller is smart they will structure the option to be open ended in such a way that they can price accordingly for an appreciating market yet keep the pricing static for a depreciating market. So you as the buyer need to make sure that the option is structured in such a way as to minimize your risk of loss of the option price including events that will happen due to appraisal or not making appraisal.

[SD Realtor]

Basically lease options are heavy favorites for the sellers. It is a good way to make money because the odds are VERY substantial that the buyer does not exercise the option. Similarly there are always complexities with the pricing and appraisal valuation because none of them can be really decided until the option is exercised. If the seller is smart they will structure the option to be open ended in such a way that they can price accordingly for an appreciating market yet keep the pricing static for a depreciating market. So you as the buyer need to make sure that the option is structured in such a way as to minimize your risk of loss of the option price including events that will happen due to appraisal or not making appraisal.

[SD Realtor]

Basically lease options are heavy favorites for the sellers. It is a good way to make money because the odds are VERY substantial that the buyer does not exercise the option. Similarly there are always complexities with the pricing and appraisal valuation because none of them can be really decided until the option is exercised. If the seller is smart they will structure the option to be open ended in such a way that they can price accordingly for an appreciating market yet keep the pricing static for a depreciating market. So you as the buyer need to make sure that the option is structured in such a way as to minimize your risk of loss of the option price including events that will happen due to appraisal or not making appraisal.

[SD Realtor]

Basically lease options are heavy favorites for the sellers. It is a good way to make money because the odds are VERY substantial that the buyer does not exercise the option. Similarly there are always complexities with the pricing and appraisal valuation because none of them can be really decided until the option is exercised. If the seller is smart they will structure the option to be open ended in such a way that they can price accordingly for an appreciating market yet keep the pricing static for a depreciating market. So you as the buyer need to make sure that the option is structured in such a way as to minimize your risk of loss of the option price including events that will happen due to appraisal or not making appraisal.

[SD Realtor]

Basically lease options are heavy favorites for the sellers. It is a good way to make money because the odds are VERY substantial that the buyer does not exercise the option. Similarly there are always complexities with the pricing and appraisal valuation because none of them can be really decided until the option is exercised. If the seller is smart they will structure the option to be open ended in such a way that they can price accordingly for an appreciating market yet keep the pricing static for a depreciating market. So you as the buyer need to make sure that the option is structured in such a way as to minimize your risk of loss of the option price including events that will happen due to appraisal or not making appraisal.

[34f3f3f]

SDR, good point about appraisal not being “decided” until exercised. If other buyers are allowed to make offers, with the lessee retaining right of first refusal, that might help fix that bug. I’m not clear why the lease option has to contain a forward? Fair market value would remove that element of risk, and entice more people into these arrangements. I see that as more relevant now with so many sellers betting on appreciation, and buyers betting on declines. It’s clogging up the system.

[34f3f3f]

SDR, good point about appraisal not being “decided” until exercised. If other buyers are allowed to make offers, with the lessee retaining right of first refusal, that might help fix that bug. I’m not clear why the lease option has to contain a forward? Fair market value would remove that element of risk, and entice more people into these arrangements. I see that as more relevant now with so many sellers betting on appreciation, and buyers betting on declines. It’s clogging up the system.

[34f3f3f]

SDR, good point about appraisal not being “decided” until exercised. If other buyers are allowed to make offers, with the lessee retaining right of first refusal, that might help fix that bug. I’m not clear why the lease option has to contain a forward? Fair market value would remove that element of risk, and entice more people into these arrangements. I see that as more relevant now with so many sellers betting on appreciation, and buyers betting on declines. It’s clogging up the system.

[34f3f3f]

SDR, good point about appraisal not being “decided” until exercised. If other buyers are allowed to make offers, with the lessee retaining right of first refusal, that might help fix that bug. I’m not clear why the lease option has to contain a forward? Fair market value would remove that element of risk, and entice more people into these arrangements. I see that as more relevant now with so many sellers betting on appreciation, and buyers betting on declines. It’s clogging up the system.

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