Lease Purchase Option Contract Ohio

8 Replies

I have a buyer for my FSBO. They will rent for 6 months and then purchase. Asking all BP buddies if you have an approved Ohio Lease Option Form can you please share.

I am in Mansfield Ohio if there are any fellow BP friends that would like to hook up.

Have a good day,

Karen

@Karen Moysi

  1. -2 seperate agreements with escrow instructions.
  2. -Lease for Ohio for 6 months.
  3. -Sale and Purchase with 3% Earnest money.
  4. -Escrow instructions to either close on delayed S and P or cancel agreement and keep 3%.

Brian Gibbons

@Karen Moysi

You could draw it up a variety of ways. This isn't really the sort of spot I'd recommend you use a "form". You especially want to be sure that you structure this carefully because in the event the tenant buyer goes delinquent you'd much rather be performing an eviction instead of a foreclosure to get possession of the property back. Ohio law draws a pretty clear bright line that says land contract vendees must be foreclosed upon and not evicted if they've paid 20% of the purchase price OR paid for 5 years on the contract. Still, you don't want to risk an error with the structure of this contract and find that a judge interprets the situation to your detriment.

That said, Brian Gibbons has offered you a blue print that sounds pretty good to me.

Timothy Murphy III, Real Estate Agent in OH (#SAL.2016005240)

@Timothy Murphy III

In general buying on land contract is wonderful and selling on land contract is complicated

I love the five year 20% rule

Lease purchase when selling and getting 3% down with a lease of six months and a carefully crafted delayed sale and purchase agreement I think is the strongest possible protection for the seller in case the tenant does not perform and get the mortgage

Brian Gibbons

I like the concept.

Immediate cash flow to cover your note in the meantime, a health (but not excessive) amount as non refundable option consideration / earnest money / etc., and a six month window for the tenant buyer to actually get the financing worked out.

Timothy Murphy III, Real Estate Agent in OH (#SAL.2016005240)

Originally posted by @Brian Gibbons :

@Timothy Murphy III

In general buying on land contract is wonderful and selling on land contract is complicated

I love the five year 20% rule

Lease purchase when selling and getting 3% down with a lease of six months and a carefully crafted delayed sale and purchase agreement I think is the strongest possible protection for the seller in case the tenant does not perform and get the mortgage

 Greetings of Peace Brian Gibbons,

Are you saying that a "delayed sale and purchase agreement" is what I need to have in my possession for a Lease Purchase deal in the state of Ohio?

Thanks for the Response!

Hello all,  I'm in pursuit of buying a cash performing commercial piece of property in Ohio.  A possible lender has mentioned, "refundable escrow option."  could someone clarify. 

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