Lease With Option To Purchase

Lease With Option To Purchase

Lease With Option To Purchase means:
a lease that gives the lessee (tenant) the right to purchase property at an agreed-upon price under certain conditions. In general, a lease is a contract in respect of real or personal property, under which the owner of the property grants to another the right to possess, use and enjoy the property for a specified period of time in exchange for periodic payments. If a lease bears characteristics similar to those of a financing device, the arrangement will be treated as financing, not a lease. An option to purchase at fair market value would appear to be a lease; by contrast, an option at a bargain price would indicate equity build-up through the “rent” and would be an indication of financing.


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