Dear Juris Doctor;
I want to lease a property and have the right to purchase it. What is the difference between an option to purchase and a right of first refusal?
With appreciation, Elizabeth at PGA National
Dear Elizabeth;
Your lease should outline your ability to purchase the property in the future. If you are certain you will buy the property but lack the ability to do so when you begin the lease, an option to purchase will usually require you to pay a nonrefundable deposit, specify the purchase price and the period of time within which to buy the property. Usually a tenant will have the option to purchase at any time during the lease period by providing written notice to the landlord.
A right of first refusal usually provides that the tenant will be notified in writing during the lease period if the landlord will sell the property and the sale price – or if the landlord receives a written offer from a 3rd party, then the landlord shall notify the tenant and provide a period of time (e.g. 48 hours) to provide a contract with the same terms as the 3rd party offer.
Sincerely, J.D.