"SUB-LEASE" OPTION? - Posted by Ross (VA)

Posted by NAte(DC) on July 02, 2002 at 10:04:21:

The only thing you’d have to be careful of is that the option was drafted correctly. A typical “option” contract is exercisable anytime after it is signed. You would need to make sure that the sub-lessee’s option from you is not exercisable for the first 12 months, because you might not own the property then.

Or you could just make their option contingent on you acquiring title to the property.


“SUB-LEASE” OPTION? - Posted by Ross (VA)

Posted by Ross (VA) on July 02, 2002 at 09:51:24:

Maybe this is a dumb question but I’ll ask it anyway…

If I lease a property from the seller with an option to buy in 12 months, can I “sub-lease” that property and give them an option to purchase in say…16 months?(for more than I paid of course) - Ross (VA)

Re: “SUB-LEASE” OPTION? - Posted by jerry

Posted by jerry on July 02, 2002 at 19:47:27:

As another newbie, I have no business answering questions here, but I think it’s pretty basic that you get a LONGER option period from your seller, give your tenant/buyer a SHORTER option period. This gives you time to get a committment from your buyer BEFORE giving a committment to your seller. You have it reversed. Picture this: Your option expires in 12 months and in 13 months your buyer says he wants to exercise his option. You could get sued, or, if you’re lucky, you’ll just lose the great deal you set up to your seller, who will no longer have an obligation to you and can sell to your buyer. Maybe I’m naive, but this seems cut and dried.