LEASE OPTION BENEFITS
By the Beach knows that many people find their ideal home by renting. A lease option can be an easy, low-stress and inexpensive way to buy, sell or invest in real estate. For many buyers, a lease-option on a piece of property can be a very viable choice in a tightened credit market. You can turn your rent into an investment as you rebuild your credit and savings without the pressure of a mortgage. If you don’t like the house, you are free to move on at the end of the lease term. If a renter needs more time, often the lease can be extended to allow this. A lease option also has the added benefit of locking in a purchase price as property values increase in a rising real estate market like Myrtle Beach, South Carolina.
The seller benefits from a lease option as well. The renter’s payments allow them to cover their mortgage, and the seller has a potential buyer at the end of the option. Renters can be rough on a home, particularly when they don’t plan to be there long. Because you are renting to a person with a long term interest in the home, there’s a much higher chance of having a responsible tenant.
LEASE OPTION – HOW IT WORKS
Lease options are regularly used by people who want to buy a house, but need extra time to work on their credit profile or save up for a down payment. A lease-option agreement between a renter and an owner is a contract to rent a property at a higher price than market value, with an option to purchase the home within a specific period (usually 12 months or less) at a given price. The tenant pays a non-refundable “option fee” or security deposit which is typically 1% to 5% of the purchase price. This fee goes toward the purchase price of the home once the option agreement to purchase the home has been exercised. If the renter decides not to purchase the property at the end of the lease-option; the owner retains the additional rent and the option fee.
As you can see, a lease option arrangement from By the Beach on Myrtle Beach real estate and Grand Strand homes can be a very beneficial arrangement for owners and renters.
Frequently Asked Questions About Lease Options
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