Residential Lease Option to Buy
More than 40 Years of Real Estate Law Practice in Yamhill County, Washington County, Clackamas County, Marion County, and Polk County, State of Oregon.
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Larry K. Gray & Associates, PC
A residential lease with an option to buy includes the terms of a residential rental agreement with additional terms akin to an Earnest Money Agreement. In the current real estate market, a lease to buy arrangement may be a viable approach to deal with the current problems facing sellers and purchasers. The property owner has the rights and obligations of a landlord with the potential rights and obligations of a seller of real estate. The tenant has the rights and obligations of a residential tenant and the potential to be a buyer if the tenant so elects. The tenant has the right to be the sole decision maker as to whether or not to exercise the option to purchase during the option period, and the property owner needs to be in a position during the option period to honor the terms of the tenant’s right to buy.
The lease to buy agreement needs to be in writing, signed by the property owner and tenant, and specify the terms of the option to purchase. The rental portion of the agreement can be a fairly standard residential rental agreement, but the option portion of the agreement needs to specify terms such as purchase price, how the purchase price is to be paid, length of option period, how the option can be exercised, when and how the option period can terminate early, condition of property and title at time of purchase, and many of the other terms typically found in an Earnest Money Agreement.
The Seller must be in a position to honor the terms of the option to buy. If the tenant/buyer is paying an up front premium or accumulating a prepaid down payment, the buyer needs to have the same concerns as a buyer with an Earnest Money Agreement. Often, an option to buy is added to a residential lease with little consideration to potential future complications.
For a knowledgeable, experienced, and cost-effective
Real Estate Attorney, including residential leases,
comercial leases, and lease options to purchase,
contact Larry K. Gray & Associates, P.C.
Larry K. Gray has been helping clients for more than 40 years.
Larry K. Gray & Associate, P.C.
404 East First Street
Phone: (503) 538-1350
Newberg, Oregon 97132
The information on this website is not intended to be legal advice regarding your particular legal problem, and the presentation of this information does not create an attorney-client relationship. An attorney-client relationship will only exist after a mutual agreement to establish an attorney-client relationship.