3 Things that Can Go Wrong with a Lease Option

A lease option can be a great way to sell a property, and is beneficial for both the buyer and seller. However, there are a number of problems that you may encounter in this agreement, which can be costly and frustrating.

1. Tenants Don't Pay Rent

If your tenant does not pay their rent, then you will have to file with the courts for an eviction , and usually have to wait thirty days for them to be evicted. Then you have to rent the home again.

2. Tenants Don't Want to Buy The Property

After living in the home, some tenants decide they don't want  to buy. This is a disappointment for the seller since they have to start all over with another tenant. However, in a lease option, there should be a down payment paid upfront which the tenant loses if they don't buy the property.

3. Tenants Can't Buy The Property

There are many reasons the tenant can't buy at the end of the term. These include job loss, interest rate increases, property value decreases, credit issues. There are several reasons why a tenant could be denied a mortgage and this means the seller has to find another tenant to rent the home to.