Free Rent To Own Agreement Template for Microsoft Word

Rent To Own Agreement

This Rent to Own Agreement (this “Lease”) is made effective as of [Insert Date Here] (“Effective Date”), by and between [Insert Name of Landlord Here] (“Landlord”), and the following tenants:

[Insert Name of Tenant Here]

(the “Tenant”)

Subject to the terms and conditions stated below the parties agree as follows:

PREMISES

Landlord, in consideration of the lease payments provided in this Lease, leases to Tenant [Describe the Property Being Leased Here] (the “Premises”) located at [Insert Address of the Property Here].

TERM

The lease term will begin on [Insert Start Date Here] and will terminate on [Insert End Date Here]. If the Purchaser fails to exercise the option by such time and date, the option will automatically terminate, and the Seller will be entitled to retain the non-refundable consideration stated below.

LEASE PAYMENTS

Tenant shall pay to Landlord monthly installments of $[Insert Amount Here] per month, payable in advance on the first (1st) day of each month. Lease payments shall be made to Landlord at [Insert Address Where Tenant/s Will Send Payments], which location may be changed, in writing by Landlord, with a minimum of [Insert Number of Days] days advanced notice to Tenant.

SECURITY DEPOSIT AMOUNT

At the time of the signing of this Lease, Tenant shall pay to Landlord, in trust, a security deposit of $[Insert Amount Here].

The deposit shall be applied as follows:

Security Deposit: $[Insert Amount Here] to be held and disbursed for Tenant damages to the Premises or other defaults under this Agreement, if any, as provided by law.

POSSESSION

Tenant shall be entitled to possession on the first (1st) day of the term of this Lease and shall yield possession to Landlord on the last day of the term of this Lease unless otherwise agreed by both parties in writing. At the expiration of the term, Tenant shall remove its goods and effects and peaceably yield up the Premises to Landlord in as good condition as when delivered to Tenant, ordinary wear and tear excepted.

USE OF PREMISES/ABSENCES

Tenant shall occupy and use the Premises as a dwelling unit. Tenant shall notify Landlord of any anticipated extended absence from the Premises not later than the first (1st) day of the extended absence.

PETS

No pets shall be allowed on the Premises.

PROPERTY INSURANCE

Landlord and Tenant shall each be responsible to maintain appropriate insurance for their respective interests in the Premises and property located on the Premises. Tenant shall be required to maintain renter’s insurance of not less than $[Insert Amount Here].

DAMAGE CAUSED BY TENANT

If any damage to the property shall be caused by their act or neglect, the Tenant shall forthwith repair such damage at their own expense, including damage to screens and windows where same is not covered by Landlord’s insurance.

MAINTENANCE

The Landlord shall have the responsibility to maintain the Premises in good repair at all times and perform all repairs necessary to satisfy any implied warranty of habitability. The Tenant must notify Landlord within twenty-four (24) hours of any condition requiring maintenance.

UTILITIES AND SERVICES

Tenant shall be responsible for all utilities and services in connection with the Premises for the term of this Lease.

TAXES

The Landlord shall pay all real estate taxes which may be levied against the Premises.

DESTRUCTION OR CONDEMNATION OF PREMISES

If the Premises are damaged or destroyed by fire or other casualties to the extent that enjoyment of the dwelling unit is substantially impaired, Landlord, in its sole discretion may elect to repair the Premises or terminate the Lease upon [Insert Number of Days] days’ written notice to Tenant. If the Premises are condemned or cannot be repaired, this Lease will terminate upon [Insert Number of Days] days’ written notice by either party.

HABITABILITY

Tenant, or an authorized agent on Tenant’s behalf, has inspected the Premises and fixtures and acknowledges that the Premises are in a reasonable and acceptable condition of habitability for their intended use, and the agreed lease payments are fair and reasonable. If the condition changes so that, in Tenant’s opinion, the habitability and rental value of the Premises are adversely affected, Tenant shall promptly provide reasonable notice to Landlord.

DEFAULTS

Tenant shall be in default of this Lease if Tenant fails to fulfill any lease obligation or term by which Tenant is bound. Subject to any governing provision of law to the contrary, if Tenant fails to cure any financial obligation within [Insert Number of Days Here] days (or any other obligation within [Insert Number of Days Here] days) after written notice of such default is provided by Landlord to Tenant, Landlord may elect to cure such default and the cost of such action shall be added to Tenant’s financial obligations under this Lease.

LATE PAYMENTS

For each payment that is not paid within [Insert Number of Days Here] days after its due date, Tenant shall pay a late fee equal to 0 % of the required payment, or as otherwise provided by applicable law

HOLDOVER

If Tenant maintains possession of the Premises for any period after the termination of this Lease (“Holdover Period”), Tenant shall pay to Landlord lease payment(s) during the Holdover Period at a rate equal to [Insert Percentage Here]% of the most recent rate preceding the Holdover Period. Such holdover shall constitute a month-to-month extension of this Lease.

CUMULATIVE RIGHTS

The rights of the parties under this Lease are cumulative, and shall not be construed as exclusive unless otherwise required by law.

NON-SUFFICIENT FUNDS

Tenant shall be charged the maximum amount allowable under applicable law for each check that is returned to Landlord for lack of sufficient funds.

REMODELING OR STRUCTURAL IMPROVEMENTS

Tenant shall have the obligation to conduct any construction or remodeling, at Tenant’s expense, that may be required to use the Premises as specified above. The Tenant may also construct such fixtures on the Premises, at Tenant’s expense, that appropriately facilitate its use for such purposes. Such construction shall be undertaken and such fixtures may be erected only with the prior written consent of Landlord, which shall not be unreasonably withheld. At the end of the lease term, Tenant shall be entitled to remove, or at the request of Landlord, shall remove such fixtures, and shall restore the Premises to substantially the same condition of the Premises at the commencement of this Lease.

ACCESS BY LANDLORD TO PREMISES

Subject to Tenant’s consent, which shall not be unreasonably withheld, Landlord shall have the right to enter the Premises to make inspections, provide necessary services, or show the unit to prospective buyers, mortgagees, tenants, or workers. However, Landlord does not assume any liability for the care or supervision of the Premises. As provided by law, in the case of an emergency, the Landlord may enter the Premises without Tenant’s consent.

DANGEROUS MATERIALS

Tenant shall not keep or have on the Premises any article or thing of a dangerous, flammable, or explosive character that might substantially increase the danger of fire on the Premises, or that might be considered hazardous by a responsible insurance company unless the prior written consent of Landlord is obtained and proof of adequate insurance protection is provided by Tenant to Landlord.

MECHANICS LIENS

Neither Tenant nor anyone claiming through the Tenant shall have the right to file mechanics liens or any other kind of lien on the Premises and the filing of this Lease constitutes notice that such liens are invalid. Further, Tenant agrees to (1) give actual advance notice to any contractors, subcontractors, or suppliers of goods, labor, or services that such liens will not be valid, and (2) take whatever additional steps that are necessary in order to keep the premises free of all liens resulting from construction done by or for the Tenant.

SUBORDINATION OF LEASE

This Lease is subordinate to any mortgage that now exists, or maybe given later by Landlord, with respect to the Premises.

OPTION TO PURCHASE

Tenant, upon satisfactory performance of this Lease, shall have the option to purchase the real property described herein for a purchase price of $[Insert Amount Here], provided that the Tenant timely executes the option to purchase and is not in default of the Lease Agreement. Thereafter, each of the parties shall promptly execute any and all further instructions or other documents including a Sale Agreement which may be reasonably required for purchase of the real property. The Landlord shall credit towards the purchase price at closing the sum of $[Insert Amount Here] from each monthly lease payment that the Tenant timely made.

TITLE

The Landlord agrees to deliver, and Tenant agrees to accept, title to the Premises subject only to (a) a lien for taxes and assessments levied against the Premises, (b) any covenants, conditions, restrictions, easements, right, rights-of-way of record, and (c) such other exceptions as Landlord and Tenant approve in writing. Landlord shall deliver to Tenant a preliminary title report within thirty (30) days after Tenant’s exercise of the option.

NOTICE REQUIRED TO EXERCISE OPTION

To exercise the Option to Purchase, the Tenant must deliver to the Landlord, a written notice of Tenants intent to purchase, not less than [Insert Number of Days Here] days prior to the expiration of the Lease Term. In addition, the written notice must specify a valid closing date. The closing date must occur before the original expiration date of the Lease Agreement.

OPTION CONSIDERATION

Nonrefundable option consideration in the amount of $[Insert Amount Here] paid by the Tenant as consideration for this Option to Purchase Agreement, shall be credited to the purchase price at closing if the Tenant timely exercises the option to purchase. If the Tenant doesn’t exercise the option to purchase, the Tenant shall forfeit the non-refundable option consideration.

EXCLUSIVITY OF OPTION

This Option to Purchase Agreement is exclusive and non-assignable and exists solely for the benefit of the named parties above. Should Tenant attempt to assign, convey, delegate, or transfer this option to purchase without the Landlords express written permission, any such attempt shall be deemed null and void.

CLOSING AND SETTLEMENT

Tenant agrees that closing costs in their entirety, including any points, fees, and other charges required by the third-party lender, shall be the sole responsibility of Tenant. The only expense related to closing costs apportioned to Landlord shall be the pro-rated share of the property taxes due at the time of closing, for which Landlord is solely responsible.

FINANCING DISCLAIMER

THE PARTIES ACKNOWLEDGE THAT IT IS IMPOSSIBLE TO PREDICT THE AVAILABILITY OF OBTAINING FINANCING TOWARDS THE PURCHASE OF THIS PROPERTY. OBTAINING FINANCING SHALL NOT BE HELD AS A CONDITION OF PERFORMANCE OF THIS OPTION TO PURCHASE AGREEMENT. THE PARTIES FURTHER AGREE THAT THIS OPTION TO PURCHASE AGREEMENT IS NOT ENTERED INTO IN RELIANCE UPON ANY REPRESENTATION OR WARRANTY MADE BY EITHER PARTY.

REMEDIES UPON DEFAULT

If Tenant defaults under this Option to Purchase Agreement or the Lease Agreement, then in addition to any other remedies available to Landlord in accordance with [Insert State Here] law, Landlord may terminate this Option to Purchase by giving written notice of the termination. If terminated, the Tenant shall lose entitlement to any refund of rent or option consideration. For this Option to Purchase Agreement to be enforceable and effective, the Tenant must comply with all terms and conditions of the Lease Agreement.

ACKNOWLEDGMENTS

The parties are executing this Option to Purchase Agreement voluntarily and without any duress or undue influence. The parties have carefully read this Option to Purchase Agreement and have asked any questions needed to understand its terms, consequences, and binding effect and fully understand them and have been given an executed copy.

ASSIGNABILITY/SUBLETTING

The Tenant may not assign or sublease any interest in the Premises, nor assign, mortgage, or pledge this Lease, without the prior written consent of Landlord, which shall not be unreasonably withheld.

NOTICE

Notices under this Lease shall not be deemed valid unless given or served in writing and forwarded by mail, postage prepaid, addressed to the party at the appropriate address set forth below. Such addresses may be changed from time to time by either party by providing notice as set forth below. Notices mailed in accordance with these provisions shall be deemed received on the third day after posting.

LANDLORD:

[Insert Name of Landlord Here]

[Insert Address of Landlord Here]

TENANT:

[Insert Name of Tenant Here]

[Insert Address of the Property Here]

Such addresses may be changed from time to time by either party by providing notice as set forth above.

GOVERNING LAW

This Lease shall be construed in accordance with the laws of the State of [Insert State Here].

ENTIRE AGREEMENT/AMENDMENT

This Lease contains the entire agreement of the parties and there are no other promises, conditions, understandings, or other agreements, whether oral or written, relating to the subject matter of this Lease. This Lease may be modified or amended in writing if the writing is signed by both parties.

SEVERABILITY

If any portion of this Lease shall be held to be invalid or unenforceable for any reason, the remaining provisions shall continue to be valid and enforceable. If a court finds that any provision of this Lease is invalid or unenforceable, but that by limiting such provision it would become valid and enforceable, then such provision shall be deemed to be written, construed, and enforced as so limited.

WAIVER

The failure of either party to enforce any provisions of this Lease shall not be construed as a waiver or limitation of that party’s right to subsequently enforce and compel strict compliance with every provision of this Lease.

BINDING EFFECT

The provisions of this Lease shall be binding upon and inure to the benefit of both parties and their respective legal representatives, successors, and assigns.