lease option

Primary tabs

A lease option, or a lease with the option to purchase, is a type of contract for real property (such as a house) or personal property (such as a car) that gives the lessee the option to buy the property at the end of the lease period.

Different from a lease purchase contract, which binds the lessee to buy the property and the lessor to sell the property, a lease option binds the lessor to sell, but gives the lessee option to buy.

Lease options can be very meaningful to buyer when the buyers have not enough down payment. Sellers would usually raise the price of the property, and therefore can be benefited from the lease options as well.

[Last updated in July of 2020 by the Wex Definitions Team]