Should I consider a lease option (as seller)
Lease options have been around for decades and have gained popularity recently due to banks being very selective as to making loans. When you offer your Weston home for sale either as an outright purchase or a lease option, you will expand the number of people who will consider your house.
Sell Lease Options
While there are still many buyers who can qualify for a bank loan out there, there are also many buyers who won’t. To expand your possible universe of buyers the lease option is many times a not only viable option, but also a smart one.
The basics of a lease option are that you will offer you home at a market lease rate and generally will allow a portion of what people are paying in lease payments to be applied toward the purchase of your Weston home, generally at the end of the year. When you offer you house as a lease option you should receive what we refer to as a “Non-refundable option consideration fee”. This will vary, but should be as close to 3% of the purchase price as possible and in some instances even a little more.
This fee is subtracted from the purchase price if the lease option tenants exercise their option as wish to purchase the home during or at the end of your lease term. I like to tie their monthly payments being on time each month to their option. In other words if they make even one payment late they lose whatever the option consideration fee is along with any accrued credit you have negotiated for their monthly lease payments.
The upside to this method of is that it attracts buyers who otherwise would not consider your home & they generally are not concerned about the purchase price as much as they are the rent credits, option fee and monthly lease amount.
It is always a good idea to use a competent real estate attorney to draft the documents you will need and your Realtor can recommend one for you.
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