The lease with option to purchase is a system we are already familiar with as regards the automobile. But, this flexible method to dispose of a car does not apply only to this sector. Real estate is brought to offer more and more often rental with option to buy.

Definition of the lease with option to purchase

The principle is very simple. A developer or an owner offers you to rent a property, whether it is a house or an apartment. This leasing period lasts from 1 to 3 years, after which the lessor has the choice between buying the house or condo at the price determined by the contract or leaving.

Rental with option to buy a condo or a house: for whom?

This system is primarily intended for prospective purchasers who have difficulty obtaining a mortgage loan. The self-employed who have just started are particularly concerned. But they are not the only ones. Concerns about his credit record may also push a buyer to turn to lease with option to buy.

In addition, Canadians who are financially well qualified to qualify for a mortgage loan may also choose a lease with an option to purchase. This solution ensures that the property perfectly matches the expectations of the buyer. Obviously, in terms of quality, situation, configuration, etc. It is often said that you have to live in a house or a condo to know the advantages and disadvantages. Renting with an option to purchase therefore ensures that you have made the right choice while avoiding hidden defects.

Who offers rentals with an option to purchase?

Several homeowner profiles can offer a lease with option to buy:

1. 1. Developers: Instead of waiting to find a buyer for all the houses in a subdivision or all the condos of a building, the lease with an option to purchase allows real estate developers to avoid the vacancy of units. Even if the sale does not end, funds will have been collected while the property is likely to be sold at a higher price.

1. 1. Intermediaries specializing in lease with purchase option: these real estate players buy existing properties in order to offer them for lease with option to buy. And, sometimes, to their owner who is going through a period of financial hardship.

1. The details

Attention to the contract

As every time you sign an agreement, make sure you understand all the terms. Your mortgage broker will decrypt them and advise you at best. Especially if you want to turn to rental with option to buy because of financial worries. There may be other classic solutions at your fingertips, your broker will be able to identify them for you.

Latest advice and conclusion

Renting with the option of buying a house or a condo is a potentially attractive solution for both parties. The lessor must nevertheless ensure that he has the necessary means to proceed with the acquisition at the end provided for in the agreement. But, also, that the deposit for the down payment is not too high in case the transaction had to roll over (this sum is lost in case of non-purchase).

Did you resign yourself to accepting a lease with a purchase option due to financial difficulties or refusal from your bank?

Turn to our mortgage brokers, they can unlock the situation via a conventional solution.

And, you live in the Montreal area and you are in such a case?