Home Lease Purchase Agreement Information
A home lease purchase agreement is an option given to potential home buyers who are unable to purchase their desired house outright. They instead sign an agreement to lease the house with an option to purchase at a later, agreed-upon date.
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Details
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The home lease purchase agreement usually involves the buyer agreeing a down payment to theseller. The down payment can be the rental price or a different sum. This gives the buyer time to find alternative methods of payment, such as a mortgage or enough money to pay for the house outright.
Time Frame
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The buyer and seller traditionally agree on a set date for the alternative method of payment to be made. If the buyer is unable to provide this alternate method before the agreed time, the seller is allowed to evict anyone living in the house, as well as keep all payments made prior to the agreement.
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Differences
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In some respects, the home lease purchase agreement is very different from a traditional mortgage. Under such an agreement, the house is still the seller's property. Therefore, any decorations or renovations made by the buyer, in effect, belong to the seller.
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References
- Photo Credit apartment lease sign image by Aaron Kohr from Fotolia.com
