Rent to own lease option: please help

There are 2 transactions:
1. Tenancy
2. Option to purchase

With the tenancy there will be a bond as per the RTA requirements.
WIth the option you can charge the option taker a non refundable option fee.

Hi scha9799

I'd suggest you ask the person who has offered to take the property from you on a Lease/Option (often called a Rent To Own), if she/he is planning to on-sell the property with another Lease/Option.  This technique is called a Back to Back Lease/Option or Sandwich Lease/Option and is often used by vendor financiers.

As a vendor financier myself I don't like Sandwich Lease/Options because , as the owner, you are giving away a huge amount of control of the property with the possibility that, if things go wrong, the person that took the first Lease/Option can just hand it back to you.

If the person that's trying to take control of your property is really serious about buying the property, possibly offer vendor finance but, offer this vendor finance by way of an Instalment Contract or Deposit Finance.  These two techniques are much more highly regulated and your position will be stronger.

Of course, I also suggest you get independent advice from an appropriate professional.

Cheers,  Paul

Hi Maverick

As the property is in Qld you will need a solicitor that's registered in Qld.  Mark Game is my go to solicitor for all things vendor finance in Qld.  To contact Mark call him on 07 3236 0001 or by e-mail at [email protected]

Cheers,  Paul

Hi Paul.

Now there is mutual recognition between states so a solicitor admitted in NSW can do work for someone in QLD and can even act in QLD or another state. But most wouldn't act for property matters because they wouldn't be familiar with the procedures and different state laws.

I've done these before, not too tricky, the investor is subleasing to their tenant and should get your permission for this in writing from you. 2 bonds, you can put the 5k wherever you like but I've always been advised to put at least $100 towards some sort of a bond for your insurance company as they like to see some sort of a bond., you could have no bond if you prefer or a full bond. Investor is still responsible for the lease to you regardless of what the tenant  in the house does, plus he is responsible for the house and responsible for the condition of the house. If  the investor wants to pass on the option to his buyer it needs to be allowed for in  the paperwork between you and investor that your allowing him to do this. Definitely talk  to Tony if your going that way but nothing wrong with these transactions, investors like to keep the option and rent them, I had one even do share accommodation on a rent to buy once…

Cheers Sheree 

Lol Paul true there are much more elegant solutions than the  sandwich lease option these days, especially with joint venture agreements being more prevalent now .. But occasionally it seems to be the right solution for some parties