Re: Lease options - how much do you get down? - Posted by The Donald
Posted by The Donald on June 21, 2000 at 22:52:32:
First and last - in Ontario this is a given for the lease.
For the option - get consideration of anywhere up to 5% non-refundable option consideration - if they walk away or fail to pay rent or abide by the lease - they lose it.
Make up the down payment/deposit amount by crediting them for a portion of rent as you go - again, non-refundable credits, of course.
In as long as you have a working relationship with a mortgage broker to PRE-QUALIFY for tenant/buyer, you won’t have a problem.
Best approach: Have them complete both a Rental Application, plus a Lease - for the Tenancy. And have them complete a Mortgage Application for your mortgage broker.
Take the Rental Application and Mortgage Application at the same time first. Then the Lease when they are approved, together with a separate option agreement to CYA.
Since it’s rent-to-own, you’ll need to make certain that when the time comes and the option is exercised, your T/B will be able to perform.
Remember, you want as much real cash (not credits) in your pocket as soon as possible