Lease Option

I Need to Sell My Property This week!

Why do I Need a Property Lease Option?

There are a number of reasons that a lease option may suit a vendor's requirements especially if you do not need to realise the cash equity in your property immediately or there is little or no equity left.

The main requirement for a property lease option sale to be suitable for a seller is that there is no immediate need to release the money that is tied up in the bricks and mortar or to repay any outstanding mortgage or other secured loans.

Struggling to sell your home or another property?

Can't find a suitable buyer with funding?

No-one looking at the home?

Been on the Market for Months?

Have already moved and unable to sell or rent out the property?

Need to move but don't have to sell to realise the cash equity now?

Would you like to have someone to pay your mortgage and running costs?

We may be able to help you find a way forward with little fuss, but lots of "Thinking outside of the Box" using a property lease purchase option.

Are you fed up with the hassle of having a home or property that you no longer need?

What are Property Lease Options and how do they Work?

Heard of an option? Options allow a prospective purchaser to agree a deal with a vendor or purchaser of a house, cottage, flat or other tangible asset with a sale or purchase completion date at an agreed price and within a specific time in the future, subject to certain agreed conditions. Selling option or buying options are used to release cash flow while retaining a financial interest for a specified time prior to final completion of the transfer of interest in the estate or property in question.

There may be any number of reasons that a property is not selling as quickly as required:-

There is a difficult or uncertain housing financial market place.
You may need to move abroad or emigrate quickly.
Your property may need some refurbishment or renovation work.
You have already had to move away for work or family reasons
A couple may have two properties but only require one to live in.
There are too many properties of that type on the market in the area.
A landlord may wish to sell up his portfolio of rented out properties.
There has been a death in the family.

Do any of the above apply to you?

How does this work?

A property vendor or home owner approaches a potential buyer / property investor / facilitator.
The facilitator or potential property buyer / investor asks a broad range of questions to establish the real key and most important issues that the owner requires a quick solution for.
The owner will be asked to provide certain financial information in order to safeguard the property and interests of the future owners from any possible claim on the property if bankruptcy were to happen to the house or flat owner.
The property is viewed and a potential option value is agreed in principal. This may be a value that meets the needs of both parties but does not reflect the current open market price for the property that a surveyor or Estate Agent might set.
It may be that the owner has little equity left in the property and just wants to get rid of the hassle and worry about vandalism or other maintenance or repair issues of looking after it.
The facilitator will consider a range of possible solutions involving financial terms and timescales to try to find a deal that is acceptable to both the property vendor and the potential purchaser.
Once a possible deal has been structured and agreed an option fee that can be anything from £1 upward is paid to the vendor to "Seal the Deal" along with the written option agreement exercisable within the agreed time option period. This legal option on the property is then recorded on the UK land registry to secure the purchaser's interest in the property.
During the negotiation period a prospective purchaser or long-term tenant-buyer may be sought who would like to live in the property, look after it as though it is their own and eventually purchase it within the agreed time in the future, for the pre-agreed value.

To discover more contact us now and discuss how we can help you to achieve your own aims in moving or acquiring a home or long-term property solution.

Every transaction or option deal is unique and is usually tailored in such a way that both the vendor and the optionee (our company in this case) agree the terms and conditions to make the deal legally binding using experienced legal teams.

A nominal option fee is payable by the optionee to the optionor to seal the deal and a legally binding option agreement is drawn up to protect the interests of the parties involved. The costs of the legal work to set up the assignable lease purchase option and searches are normally covered by the current property owner / vendor (optionor) and would be in the region of about £600 to £750. If the vendor requires a separate legal representation to ensure that the contracts are fair, then it will be important to use a solicitor that understands the lease option concept to act for and be paid by them.

A specific time period may be agreed to allow for seeking and vetting prospective tenant purchasers of the property prior to finalizing the option.

The vendor has assurance that his property will be looked after by an owner or tenant who will make repairs and improvements to the property at their own expense. If the purchase option is not exercised at the date of determination of the agreement then the property reverts to the original owner.

Likewise, if a leaseholder does not keep to the terms of the lease aspects then the property can be returned to the owner. If the current owner fails to keep to their agreed financial aspects then the option holder may exercise his right earlier or cancel the agreement and seek damages through the courts.

Lease options are attractive to landlords because they give the tenant an incentive to look after the property and to stay for several years, thus avoiding costly “voids” when the property is empty. The price the landlord pays is sacrificing some of the potential gains from a rapid rise in the property’s value.

If this would be of interest to you please contact us by using our contact form