Questions About Lease-Purchase Deal - Posted by Erich (CA)
Posted by Erich (CA) on October 31, 2000 at 10:42:24:
I’m currently putting together a lease-purchase deal…when suddenly, I realize that I don’t have all the information. Two big burning questions:
- What happens to the option consideration money? Does it apply to the down payment at closing?
I live near Silicon Valley in an area where property is at a premium and houses start at 350K. I plan to ask my tennant-buyer to put up 22K for 1 year option. She hasn’t asked me yet, but I imagine that it would break the deal if she found out that 22K will be lost.
- What kind of closing occurs at the title company? Here is my structure:
349K sales price, 15K option money, 1 year term, 1500/month rent. Somewhat motivated to sell.
359K sales price, 22K option money, 1 year term, 1750/month rent with 250/month credit to buy down purchase price.
Question, how do I close the deal? Buyer credits me my back end money? double escrow? What is commonly done?
Thanks in advance for the advice!!!