Well, if the tenant leaves voluntarily or if you make cash for the keys instead of an eviction, then you can avoid a possible seizure. Is my contract a land contract or a lease agreement with an option to purchase? The decisive difference is what happens at the end of the contract. As the sale is only hypothetical for a rental agreement, the buyer can leave at the end of the sale. The buyer loses the money from the option paid at the beginning of the contract. For most contracts, the buyer also loses the extra cash paid monthly for a down payment in addition to the rent. However, in addition to losing that money, the buyer can leave cleanly at the end of a lease option contract that he or she refuses to execute. 3. The length in residential real estate is usually 1 to 3 years. However, it is often careless when the tenant buyer accepts a short period of time (often 2 years or less). The tenant buyer often expects the property to increase in value, particularly if the agreed purchase price is equal to or greater than fair value at the time the option is opened. Perhaps more importantly, often the tenant-buyer has a credit or other financial problems that prevent him from buying immediately. The option period is used to strengthen the tenant`s credit, accumulate rental credits and position themselves when to purchase.
This can often take several years. 4. What is the amount of the monthly rent, if one of the rents is to be credited on the purchase price that reduces the purchase price. Often, the monthly rent is equal to or slightly higher than the fair market rent for the property. And while it is completely negotiable, we often offer a credit of 15%-25%. So if z.B. the fair market rent for this unit was 1,000 USD, the seller could charge 1,100 USD, of which $200 on the purchase price. However, there is a risk of losing the option tax on the buyer`s when signing the rental option. The buyer was having the consequence when he decided not to pay the rent.
This is a risk they knew when they decided not to save money for rainy days if they needed it to pay rent. Even more, if the buyer was really on the way to buying your home, they would have saved money for the down payment they could have drawn to cover the rent. Ensure that the terms you negotiate as part of your agreement do not contravene the typical charristists of a contract or lease with option to purchase (depending on your intention) or that you are faced with obstacles that you never expected (forced execution instead of lease obligations or obligation to sell).