Lease/Purchase as a Seller?

[LILRTL]

We have a lady that is heavily interested in our home, but needs to do a lease-purchase while she repairs credit. Has anyone done this? Are there any advantages as a seller? Is there a way we are protected if the person does NOT buy at the "end" of the lease? We are wary of this, but are open to it... we just don't know much about it...

TIA!

[countrymouse]

Here's my experience with a lease/purchse...

My townhouse was on the market with little activity for about 6 months. The only interested 'buyer' needed to do a lease/purchase due to credit issues. The agents wrote up a purchase agreement, she paid $3k up front as a non-refundable deposit, then paid me rent and was supposed to purchase it outright after 12 months. The plus was that her payments covered the mortgage/interest/property taxes, but 8 months into the deal she backed out (got back together with her husband). I had to put the house back on the market but luckily it sold about 3 month later. If I had to do another lease purchase, I would probably only do it for 6 months, increase the monthly payment to make it more worthwhile for me if something goes wrong, and try to get a better idea of the buyers situation (ie- no one with such terrible credit/finances that it would take a long time to fix, or someone in a temporary separation situation).

She had the house inspected before she moved in, and I paid for a home warranty for her- she was responsible for all maintenance and repairs during the length of the lease.

[honeygirl]

We did a Lease/Purchase on our rental. We wanted to rent the home but weren't finding any renters. A couple approached us and said that they loved our house, but were hoping to buy. They were willing to do a year lease with the option to purchase. They put down about 5K I think and we also had the agreement to put $100 of each month's rent towards their down-payment. However, the market slowed over the year and they decided that it wasn't in their best interest to buy at the price we'd agreed on (the year before).

So, we got to keep their 5k and the money set aside from the rental. My DH did some research back when we were setting this up and he read that only 10% of lease to own contracts actually go through.

We're happy that we did it and our house is currently on the market (to sell not lease).

Good luck!

[LILRTL]

They put down about 5K I think and we also had the agreement to put $100 of each month's rent towards their down-payment.

That really surprises me that they backed out! Were they not willing to negotiate a new price, or was that even an option? The way we have talked about doing ours is that they WILL purchase at the end... which I guess is the same thing. They are talking about putting down 5% (our minimum), which is around $9k. I don't think I could stomach walking away from $9k.

[honeygirl]

We weren't willing to negotiate the price b/c it wouldn't be in our best interest. They can come back and buy it now though. :) Seriously though, I think they decided that the house wasn't what they wanted, mostly b/c it was a far commute from his job (which they didn't know about when they moved in).