Arina S. Hanciulescu
Real Estate Specialist

When a person rents with an option to buy, he / she rents a home from its owner and lives in the home as a tenant until he / she exercises the option to purchase the home and become the owner. A contract to lease with an option to buy, called a lease purchase or lease option agreement, is a typical rental agreement but for the option clause. Usually, the option clause allows the renter to purchase the home at any time or at certain time intervals (after three years of paying timely rent, for example) by serving the owner of the home with written notice of his intent to exercise the option. Generally, the clause also gives the renter the right of first refusal, which means that the owner of the house cannot sell it to a third party unless the renter has first been offered and declined to exercise the option to buy. Typically, upon signing the contract, the renter must pay the owner a non-refundable lease option deposit. The option can be drafted so that there is only certain time period during which it can be exercised (30 days after the first of the year, for instance) or so that it expires completely after a period of years.

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Arina S. HanciulescuReal Estate Specialist

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Arina S. Hanciulescu
Real Estate Specialist

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