www.REIClub.com – Lease Options Are a Great Way to Invest in Real Estate. Watch This Video to Learn What a Lease Option Is and When It Makes Sense to Lease Properties With an Option to Buy. 1. What is a Lease Option * A “lease option” is really two separate but related agreements: a “lease agreement” and an “option agreement”. * Lease Agreement – standard agreement to rent a home, sets terms of lease * Option Agreement – the right to purchase the home within a specified period of time for a fixed purchase price * Unilateral agreement – Seller is obligated to sell, buyer not obligated to buy 2. Terms: * rent credits (?) – portion of each month’s rent is credited towards the sales price, small percentage of monthly rent * option consideration – upfront fee paid by tenant buyer to the seller that gives the tenant buyer the option to buy at a fixed priced during a certain period of time * sandwich lease – * assignment – “assign” the option over to another investor for a fee, they resume payments and ownership of the contract and property at time of closing/ending of option period. * sublease – you are the primary on the contract to purchase, but lease the property to a different tenant, responsibility is still yours. 3. Why lease options? Seller * Move property faster – buyers market = competition * Good way to sell when market is down * Pass small repairs onto buyer * Tenant Buyer – better maintenance of home, intention to buy Buyer * Appreciation – fixed price * Repair …

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