2 thoughts on “What is the difference between a lease/purchase and a lease/option contract?”
They are both a shortened name for the same thing, a lease with option to purchase. Basically it means that you are renting a property, but can decide to buy it eventually. If the owner decides to sell before you plan to buy, they cannot just sell to someone else without offering it to you at the same price. It is explained fully at the Wikipedia source I list.
By the way, your question has absolutely nothing to do with stocks or stock options.
Options are traded in units called contracts. Each contract entitles the option buyer/owner to 100 shares of the underlying stock upon expiration. Thus, if you purchase seven call option contracts, you are acquiring the right to purchase 700 shares.
For every buyer of an option contract, there is a seller (also referred to as the writer of the option). In exchange for the cash received upon creating the option, the option writer gives up the right to buy or sell the underlying stock to someone else for the duration of the option. For instance, if the owner of a call option exercises his or her right to buy the stock at a particular price, the option writer must deliver the stock at that price.
A real estate purchase contract, on the other hand, is a binding agreement (between two or more parties with legal capacity) to purchase real property. It is based on legal consideration.
Hope I helped.
Max xx
They are both a shortened name for the same thing, a lease with option to purchase. Basically it means that you are renting a property, but can decide to buy it eventually. If the owner decides to sell before you plan to buy, they cannot just sell to someone else without offering it to you at the same price. It is explained fully at the Wikipedia source I list.
By the way, your question has absolutely nothing to do with stocks or stock options.
Options are traded in units called contracts. Each contract entitles the option buyer/owner to 100 shares of the underlying stock upon expiration. Thus, if you purchase seven call option contracts, you are acquiring the right to purchase 700 shares.
For every buyer of an option contract, there is a seller (also referred to as the writer of the option). In exchange for the cash received upon creating the option, the option writer gives up the right to buy or sell the underlying stock to someone else for the duration of the option. For instance, if the owner of a call option exercises his or her right to buy the stock at a particular price, the option writer must deliver the stock at that price.
A real estate purchase contract, on the other hand, is a binding agreement (between two or more parties with legal capacity) to purchase real property. It is based on legal consideration.
Hope I helped.
Max xx