No. of Recommendations: 1
Osya, what you're looking for is called a lease option. Nolo Press offers many books on real estate (which your library probably has as well); I recommend you read over their For Sale By Owner book, which talks about lease options. THIS IS NOT A SUBSTITUTE FOR ACTUAL LEGAL ADVICE but will give you some idea of what to expect.

You will definitely want to fix the price well in advance. The benefit for the seller is that he gets a tenant who has higher than usual interest in treating the property well, has an income stream, and if you decide not to buy can turn around and sell it (pocketing your deposit). The benefit for you, obviously, is that you're not flushing rent down the toilet, and you can protect yourself somewhat from rising house prices.

You'll also want to be very clear on the length of time you have to exercise the option. Personally I would try to include a cause that if the OWNER terminates your tenancy before the lease-option period has run, that your payment must be returned. (You don't want the landlord to get the bright idea that he can evict you for no reason, keep all your money, and then turn around and sell the house.)

You also need to have the agreement signed in front of a notary, so that you can record it with the Register of Deeds in your county. This doesn't create a lien, but it definitely "clouds the title" so that it's harder to resell the house out from under you.
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