Lease Purchase

By | January 21, 2012

A lease purchase is a lawfully obligatory contract to purchase an asset or property for which the termination date has been extended. It is an alternative to hire purchase. It is an agreement to purchase a property whose price has been determined previously with the consent of both the buyer and the seller.

  • The lease purchase should begin appropriately with an introduction of the lessee or referred to as tenant and the proprietor or landowner.
  • The terms of agreement and the duration of agreement should be mentioned. Here the late charges, if any are also to be clarified.
  • The tenant will be responsible for some utilities and services like water, electricity, gas and sewer. These conditions are to be clearly mentioned as well.
  • A list of the people who would be residing or using the property is to be listed as well. Any person other than that may not use it for any other purpose without the written consent of the property holder.
  • The tenant is supposed to agree to the clauses which are levied by the landowner on keeping a pet.
  • The policies by which the entry of the tenant is defined are to written in these types of lease.

The main advantage of lease purchase is it secures the price of the property well ahead of time and at the same time it allows the buyer to reside in the property. This protects the buyer and the seller from the fluctuations of price in the real estate market.

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