While Iâ€™m not an attorney and do not give legal advice, I would suggest you proceed with extreme caution when pursuing a lease option. Lease Options have the very real possibility of turning into disputes/litigation. One of our clients recently (against our advice) entered into a lease option that ended up in court. That â€˜battleâ€™ lasted for many months and incurred extensive legal fees. Keep in mind that you are the one â€˜riskingâ€™ your option monies if you fail to exercise the option and complete the purchase. You are better off entering into a lease agreement, and if the property is later offered â€˜for saleâ€™, making an offer to purchase at that time. If you decide to pursue a Lease Option, seek out legal advice to review the agreement to protect yourself. I would also encourage you to take steps to ensure (even in a non-option lease) that the owner/seller has not defaulted on the loan on the property. We have seen situations in which a desperate owner in default, will lease out the property to an unsuspecting tenant. If the owner defaults (stops making payments) your lease agreement and/or lease option will be â€˜wiped outâ€™ at the foreclosure sale, not to mention if you will be successful in receiving your deposit back from the owner/seller after a foreclosure.
Seller may need proceeds of sale to buy something else. Best ones to look for are ones that had been rentals and are vacant now or tenants are moving.
You also want to make sure seller is current on payments, as you don't want to get in the middle of a short sale or foreclosure situation.