Just received a call from the owner. She yelled at me saying the tenant wants to buy for whatever the house appraises but she wants her $5,000 for use for her closing costs. And she says my forms have not been approved by the real estate comission. Yes, they are not. The problem is - I have a RE lisence. Now they both are after me. If I'd be in the deal - I'd probably be able to settle all this but now I am on hot. My forms are the great ones, can they just bluntly say they are ILLEGAL? This is the option: It comes from a great source but I never showed it to a lawyer. Option To Purchase Agreement For good and valuable consideration described below the Landlord agrees that _____________________________________________________________________ (Tenant) has the option to purchase the property known as: _____________________________________ for the price of $______________________________ under the following terms and conditions: a) The non-refundable option payment of $_________________ will apply in full to the purchase price at closing. In the event the Tenant fails to exercise this option or defaults under any terms of the attached Rental Agreement then this option will be void and all monies paid to Landlord by Tenant will be retained by Landlord as liquidated damages and not as a penalty. The term of this agreement is for ________________ months running concurrently with the attached Rental Agreement, and all of the terms and conditions of the Rental Agreement must have been complied with in order for this option to be valid. Tenant understands that if he/she does not comply with ALL terms of Rental Agreement then this option agreement is not valid. This includes (but is not limited to) paying the rent on time each month, and taking care of all the maintenance as described in the Rental Agreement. c) Each month that the rent is paid on time, starting on _______________________ and ending with rent paid through _________________________, Tenant shall receive a credit of $________ toward the purchase of the property. d) Rent is considered to have been paid on time if and only if it is received by Landlord by 5p.m. of the _____ day of the month for which it is due. Any acceptance of a late rent payment from Tenant to Landlord shall NOT qualify as an on time rent payment. e) To exercise this option Tenant must give seller written notice at least 90 days before this option expires. In the event that the Tenant does not give written notice of Tenant’s intention to exercise this option to purchase said property, and this written notice is not received by Landlord at least 90 days prior to the option’s expiration date, then this option is null and void. This option expires on __________________. This option is NOT contingent upon Tenant’s ability to obtain financing from a lender or for any other reason. Tenant understands that TIME IS OF THE ESSENCE for this agreement, and that Tenant’s failure to purchase the property before the expiration of this option, for any reason, or if the Tenant defaults on any of the terms or conditions of the attached Rental Agreement, shall make this option void. In this case, all option monies received by Landlord shall be kept by landlord as liquidated damages. f) This agreement is NOT an installment sale or land contract or contract-for-deed agreement or equitable mortgage, it is merely an option to purchase agreement about the above referenced property under the terms and conditions stated in this agreement. Said notice shall be mailed or delivered to: ________________________________________ ________________________________________ ________________________________________ g) There will be no real estate commission paid as a result of this transaction and tenant will be responsible for all closing costs other than documentary stamps on the deed. This option is subject to Landlord’s ability to transfer clear title to the property. Taxes and insurance will be prorated as of the date of this agreement. Landlord will credit tenant $100.00 at closing toward title insurance. h) The recording of this option or any memorandum thereof will result in the automatic revocation of this option, and all monies paid to Landlord by Tenant shall be retained by Landlord as liquidated damages and not as a penalty. In addition, Tenant will be liable to Landlord for all incidental and consequential damages for slander of title, including, but not limited to, attorneys fees and court costs for correcting title. i) Any changes Tenant wishes to make to the property prior to closing must be approved by the Landlord in writing. Any improvements made by the Tenant will become a part of the property and may not be removed by Tenant in the event of any default on the part of the tenant. j) This property is being transferred in AS IS condition. The Tenant acknowledges that they have inspected the property and accept it in current condition. The Tenant is responsible for all the repairs and maintenance during this agreement. Tenant acknowledges that Landlord has made no representations or warranties concerning the condition of the property or the improvements thereon, its ownership, the neighborhood, or the value of the property. k) All parties to this agreement have read and fully understand its provisions and hereby acknowledge the receipt of a signed copy of this agreement. Tenant is encouraged to seek the counsel of an attorney if they do not fully understand any part of this agreement. l) Additional Provisions:_____________________________________________________ _________________________________________________________________________ _________________________________________________________________________ ________________________________________________________________________. _________________________________ ____________ Landlord Date __________________________________ ____________ Tenant Date __________________________________ ____________ Tenant Date Deposit to hold property Deposit to Hold Property __________________________ (Prospective Tenant) is agreeing to a deposit of $______________ paid to hold Prospective Tenant’s position to rent to own the property located at: __________________________________________________________________. This deposit shall be paid as follows: ________________________________________________________________________________ ________________________________________________________________________________ ___________________________________________. ALL of Prospective Tenant’s deposit will apply towards the purchase of said property (it will be considered as part of Prospective Tenant’s Option Payment) provided Prospective Tenant lives up to all other terms of his/her/their agreements with Landlord. This deposit is non-refundable, and Prospective Tenant must pay additional $____________ option consideration by ________________ and his/her/their first months rent of $_____________ before moving into the property on ________________. If either of these payments is not received by Landlord on time then Landlord may at Landlord’s sole discretion cancel agreement with Prospective Tenant and all money paid to Landlord by Prospective Tenant shall be kept as liquidated damages to cover application review, marketing costs to fill property, and lost opportunities. This agreement is subject to Landlord’s final approval of Prospective Tenant’s application. In the event that Landlord does not approve for any reason, Landlord may at his/her sole discretion refund all of Prospective Tenant’s deposit and cancel this agreement. All option payments and first months rent must be in the form of either certified funds or money order except as noted below. Prospective Tenant understands that Prospective Tenant does NOT have a valid lease or option to purchase said property UNTIL Prospective Tenant makes both other payments described above on time and signs all further paperwork with Landlord, including Lease Agreement, Option to Purchase Agreement, Disclosure Forms, etc. In no case may the Prospective Tenant enter or otherwise occupy said property until ALL conditions and terms in this agreement have been fulfilled. TIME IS OF THE ESSENCE! ______________________________________ ____/___/___ Prospective Tenant ______________________________________ ____/___/___ Landlord and/or Agent for Landlord If initial deposit is to be paid by check, initial next to this paragraph to show both parties understand and agree to the following: Tenant understands that he/she/they are making a non-refundable deposit on this day to hold the property. Furthermore, Tenant hereby states that there are sufficient funds available to cover this check and that Tenant understands Landlord is relying upon the fact that this check will in fact clear. In event this check does not clear for any reason, Tenant understands that Tenant shall be liable for prosecution and collection to the fullest extent of the law. Furthermore, Tenant understands that all remaining option money and first months rent must be in the form of either certified funds or money order.
