What is a Lease Option?

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Disclaimer: This guide is for information only and should not be relied upon as definitive. Details have been obtained from various sources and although we have done everything possible to ensure that it is correct, however we cannot accept responsibility for it or guarantee its accuracy. This is because processes and laws change frequently, and may vary dependant upon personal circumstances. You are welcome to use the information provided, but should always obtain confirmation of specific details and get independent specialist and legal advice.

The Benefits of Lease Option for the vendor:

There are times when selling a property for cash is neither preferable nor possible. This is particularly the case when a property has little or no equity in it. If a seller needs to stop paying the mortgage and is in the position to move on without selling the property at below its full market value, then we can help by using an instrument called a lease option.

Although relatively new in the UK, lease options have been used in the USA and Australia for over 30 years.

A lease option is a combination or a “lease” and an “option”. The lease allows our company or one of our associates, to rent the vendors property and to become responsible for the vendors mortgage payments.

The vendor can move out of the property without any further burden of mortgage payments. In return, the vendor grants us the right but not the obligation to purchase the property at a specific price in the future.

 This is the option part of the agreement. The sale price that we agree upon is usually fairly close to today’s full market price and the period to exercise the option is usually between two to five years.

During this period, apart from paying the vendor’s mortgage, we or our associate become responsible for the full maintenance of the property as if we own it already. We will carefully select and screen a potential tenant/buyer who wishes to buy the property in the future and carefully manage it as though it was already our own.

However, if we choose not to exercise the option to buy the property at the end of the period, the property would just be returned to the vendor, in as good a condition that it was handed over in but most likely with improvements made to it. By that time, the vendor would have benefited from a long period of not paying the mortgage and the property may have experienced significant capital growth. However, it is worth noting that more than 95 percent of options are exercised by us or our associates.

A lease option would suit the following situations:

1.      The vendor has mortgage arrears and may be facing repossession proceedings in the near future.

 2.      The vendor needs to move on immediately without any further mortgage commitments.

 3.      There is little or no equity in the property so the vendor has no room to manoeuvre.

 4.      The vendor does not need a large lump sum of cash immediately to move on with so he/she can afford to wait a while to achieve a higher price for the property.

 5.      The vendor may have decided to downsize and pay rent elsewhere in order to cut outgoings and use surplus monies released to pay off debts and build up funds without having to sell his house at a large discount.

 6.      Maybe through relationship break up or bereavement two people wish to get together and start a new life? They both have a house each so need to sell one. They do not need the money immediately and do not want to take a quick sale at a discounted price. To them this could be the ideal solution.

 7.      Maybe the vendors are now retired, they already have a holiday home elsewhere that is already paid for and now wish sell their home so they can move to it permanently. They do not wish to sell at a discount and do not need the money right away so a lease option answers their needs.

8.      The vendor wants to secure a price that is as close as possible to today’s full market price regardless of the state of the housing market in the future.

 This service is free if you agree to use our nominated solicitor to represent you. He is a specialist in the filed of lease option agreements. The process takes approximately 28 days to complete. 

Due to the flexible nature of a lease option, it is possible to structure it so that it can completely adapt to your particular set of circumstances.  

The lease option prompts the tenants in taking care of the property, as they have the intention of buying it in the future.


The contracts of the lease options are sometimes very complex in nature. Our experience of lease options is that the language of the contract has to focus on the contract terms, rather than the price.

The finding of buyers for a proposed lease option would demand a considerable amount of time and investment on the part of the vendors and maybe beyond their experience.

We have built up a network of registered associates throughout the UK who will lease and buy your property using one of our established schemes.

Lease options benefit the vendor and the buyer in an equal manner.

They help in creating the finance required for the purchase of a new home.
The lease option permits the tenant to buy the property concerned within a time period of 2 to 6 years.

Lease options are a good source of purchasing homes for first time buyers who have not managed to save the deposit for a normal mortgage.

Lease options are also great marketing tools for the sellers of properties to find good buyers.

Our sister company www.rent2buyonline.co.uk has also built up an established list of potential tenant/buyers who will have been carefully referenced and checked out as to their suitability.

If you decide to go ahead with a lease option on your property, or would like to know more then please email me on enquiries@ronanpropertyservices.com   

Your home is your most valuable asset. Sell it as an asset, before it slowly becomes a liability. We can help you to get on with your life. Apply today to any of our websites below while this is fresh in your mind!     

London www.londonpropertybuyers.org.uk East Midlands www.eastmidlandspropertybuyers.co.uk
North East www.northeastpropertybuyers.org.uk North West www.northwestpropertybuyers.org.uk
Yorkshire www.yorkshirepropertybuyers.org.uk West Midlands www.westmidlandspropertybuyers.org.uk
All of the UK www.speedypropertybuyers.co.uk Europe & Worldwide www.speedypropertybuyers.eu


Please note that we take the issue of privacy very seriously. Any information that you supply will be used in accordance with the Data Protection Act 1998 and other applicable UK legislation. The data you supply is confidential and will only be used within the businesses of Ronan Property Services to match your requirements for a property with an investor who has a property available or to introduce property related services to you that could be of use or save you money in the future. Your personal address and contact details will not be sold to any other organisation and only be revealed to the investor when you have expressed an interest in becoming a tenant/buyer for a particular property. Your data will be kept secure and will not be used for any other purpose or disclosed to third parties without your permission.

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