Buying Real Estate Using a Lease Option

Hi, this is Frank Chen with, the only site you need as a real estate investor. Today I've got quick video on how to purchase real estate using lease options.

Locating Properties

  • Online Local Newspaper Ads – Real Estate Section – Search Keywords
  • MLS OR REALTOR.COM – Search for Keywords – rent-to-own, lease-to-own, lease to purchase, option to purchase, owner financed, lease option, lease options, lease option to buy, lease purchase, lease purchases, lease to purchase, purchase option
  • Also, properties that have been on the market for awhile – 90-180 days
  • Craigslist – Ctrl + F – use the same keywords as the MLS to quickly find what you are looking for
  • Local Pennysavers – Thrifty Nickel, Greensheet, ETC.
  • Rent-To-Own Websites
  • Landlords
  • Drive- Bys – FSBO, FRBO

Seller Negotiations

You must be able to explain all the benefits to the seller, so they will consider and accept the idea. Very rarely is a seller offering this, if they are, they're likely an investor and it's not a good deal.

Emphasis on…Less Stress

  • Good Tenant – Won't tear up property
  • No more mortgage
  • Tax benefits of ownership – until option is exercised
  • No Realtor Fees – save 3%
  • Save on marketing cost


  • Monthly rent amount – FMR – Fair Market Rent
  • Maintenance – Tenant/buyer Repairs up to $100
  • Rent Credits – Monthly extra fee (down payment) towards future purchase of the property
  • Purchase Price
  • Option to renew – 1 year term, 2-3 year option – in case market drops

Paperwork and Closing

  • Lease Option Purchase Agreement
  • Term Period
  • Parties Involved
  • Option to renew clause
  • Rent Payments/Credits

Closing – title company, or kitchen table

Exit Strategies

  • Sandwich lease – right to assign –
  • You live there
  • Find a Tenant

Purchasing real estate with Lease Options offers homeowner-ship opportunities to real estate investors. But before you jump into a lease option agreement be sure you to figure out what terms work for you before negotiating. Just like any other area of real estate investing, you have to know the process in order to effectively structure a deal in your favor.

Again, this is Frank Chen with Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you'll be automatically notified when we upload more quick video tips for you. Take care and good investing.

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