KAPIC REALTY Vince Cillino, Real Estate Consultant
100 Jefferson Road ste 128, Rochester, NY 14623
Phone  585-482-8800 Fax  585-482-7653


If you're ready to buy the home of your dreams, but your credit or savings isn't quite ready yet, a lease with option to buy (often simply called a "lease option" or, somewhat inaccurately, "rent to own") may help you move in. Lease options, in which you lease (rent) a property and have the option to buy the property at the end of the lease term, can allow you to control a home that you want even if you don't have enough money for a down payment yet. A lease option may also be helpful if you need some time to improve your credit before you can get a good mortgage rate.

 The option money or option fee is required for a lease option contract to be valid. This upfront payment may be quite small (equal to one or two month's rent, for example), or it may be 3-5% of the purchase price. All of this money should go toward the purchase price or down payment on the home if you decide to buy the house at the end of the lease term, but unlike a security deposit, you don't get the option money back at the end of the lease if you can't purchase the house or decide not to.

 Get a home inspection. Once you've found a suitable house with an agreeable seller, it's time to get the home inspected. Get an independent professional home inspector to do a full inspection so you can become aware of any problems the house may have. In most jurisdictions the seller is also required to give you a seller's property disclosure attesting to the condition of the home, but an independent inspection is still important. If there are problems, make sure they're not issues that will prevent you from getting a loan, and make sure the contract specifies who is responsible for making repairs. The lessor may also offer an allowance off the purchase price to enable the lessee to make the repairs if the option to buy is exercised.

Make improvements on the home. If the home inspection turned up minor problems, or if the home needs a little remodeling or cosmetic care, it is probably in your best interest to try to take care of these things. By increasing the value of the home with improvements during the lease term, you earn equity (so-called "sweat equity") in the home because the agreed-upon purchase price stays the same. This increased equity may help you get a more favorable loan if you exercise your option to buy. In essence, by increasing the value of the home you are increasing your down payment

Negotiate the terms of the lease option. The purchase price, term of the lease (usually anywhere from 12-24 months), the amount of initial option money, and the amount of the monthly payments that will go toward the purchase price will all be negotiable. While you can find lease option contracts online, it's best to get one from a local real estate agent or attorney, since laws concerning lease options vary from state to state, and there may even be local regulations. A real estate agent or attorney can help you draft the contract and negotiate the terms, and it's important for both the buyer and the seller (lessee and lessor) that the contract be well written

 Pay an option fee and sign the contract. The option fee is the upfront "consideration" that is necessary to make the contract binding. Pay this and sign the contract only once you are sure you understand all the terms of the agreement and you agree with them. In many cases, the lease option contract will be an addendum to a regular sale contract.

In some cases the seller will finance the home. This is typically spelled out in the lease option contract. This can make purchasing the home much easier than it would be if you had to apply for a loan

Contact us via email with the details of type of home you want and we will provide you with lease option homes available in your area. 


Phone: 585-482-8800 Direct: 585-230-5533
241 Andrews Street, Rochester, NY 14604

Licensed Real Estate Broker37CIO940783


Vince Cillino
Ph: 585-482-8800Fax:585-482-7653
100 Jefferson Road ste 128
Rochester, NY 14623 US
Licensed Real Estate Broker 37CIO940783
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