Lease Option

A lease option is a real estate agreement that combines renting and buying a property. In this arrangement, a tenant pays for the right to lease a home for a specific period, with the option to purchase it later at a predetermined price. Part of the rent may contribute toward the purchase price. This gives the tenant time to save for a down payment or improve their credit while living in the property. If the tenant decides not to buy, they can simply walk away when the lease ends, but they forfeit any additional payments made toward the purchase.