agree to a short period of time (often 2 years or less). The tenant-buyer often is expecting that the property will appreciate in value, particularly if the agreed-upon purchase price is equal to or higher than the fair market value at the time of the inception of the option. Perhaps even more important, often the tenant-buyer has credit or other financial issues preventing him/her from immediately purchasing. The option period is used to strengthen the tenant-buyer's credit, amass rent credits, and position him/herself to purchase. That often can take several years. 4. How much the monthly lease payment is, whether any of the lease payment is to be credited towards the purchase price reducing the purchase amount. Often, the monthly lease payment is equal to or slightly above the fair market rent of the property. And while it's fully negotiable, a credit in the range of 15%-25% is often offered. So, for example, if fair market rent for that unit would be $1,000, the seller might charge $1,100 with $200 of that being credited toward the purchase price. 5. Whether the tenant-buyer will occupy the property or whether the tenant/buyer has the right to sub lease or the right to sell the option. In most cases, the tenant-buyer occupies the property. Sellers will generally seek to make that one of the terms of the agreement. 6. An investor may acquire a distressed property with a lease option and make improvements to the property. Then the investor can sell the option to a buyer that is willing to pay the new market value for a profit. It is a common financing technique with investors. However, it is riskier than other methods the investor could use for controlling the property. The risks include the seller's inability to transfer clear title when the investor seeks to exercise the option. In that case, the investor will have made improvements (sometimes substantial) to a property he/she doesn't own and may not be able to acquire. If the investor is considering anything more than cosmetic enhancements, he/she might consider another method of control such as a land trust or acquiring the property using what's called a "subject to" (or Sub 2) transaction. 6.a An example: Seller has a property that needs considerable amount of work. Retail buyers typically cannot get financing or have too much to choose from to bother with physically distressed properties. Investor enters