Questions and answers about Options

Q. What happens if the buyer does not complete at the end of the option period?
A. the owner resumes responsibility for the property, in the knowledge that he has benefitted from payments being made during the option period.

Q. Are moneys paid buy the buyer refundable if the option is not taken up?
A. No.  The option fee is a non refundable deposit, similar to a mortgage application fee to cover the costs involved in setting up the transaction.

Q. In whose name is the mortgage?
A. The house owner’s name is still on the mortgage.  The mortgage is converted into a buy-to-let mortgage.

Q. Do either party need to instruct a lawyer?
A. All parties need to instruct a lawyer, but you need to make sure that the lawyer has experience in dealing with Lease Options, not many are yet.

Q. How long does an Option run for?
A. That depends on the circumstances of the particular individuals.  The normal time is between 36 and 60 months, but can be shorter.  It is normal to have an extension period negotiated at the time the first option is established to cover all eventualities and to protect both the house owner and the purchaser.

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