Skip to main content
No. of Recommendations: 1
IsisZion used the term "lease-option". In your reply you used the term "lease-purchase". Don't mean to split hairs but the difference is worth noting. In a lease-option - There is an obligation to meet lease commitments and an option or "choice" to purchase the property , usually on a date certain. A lease-purchase generally obligates both the lease AND the purchase of the property, i.e. it is not an option to purchase but rather a contractual obligation ....

So, as an investor - I prefer to use a lease-option going into a property - negotiating as long a lease as possible at as low a rate as possible, with a fixed purchase price that allows me to buy or walk.
I've used a lease-purchase as an exit strategy - bumping the tenants rent UP(so they can prove they are capable of meeting future mortgage obligations), applying a small amount per month towards the future down payment - and selling the property(1 year later in my case) as per the contract.

My two cents, 11
Print the post  

Announcements

What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.