What is a home lease purchase agreement?

A lease purchase agreement is a contract to rent the property that includes a sales contract. In this agreement, the buyer/tenant contracts to purchase the property at the end of the rental period, state FinancialWeb.

A lease purchase agreement is different than a lease with option to purchase because the property is scheduled for sale at the end of the lease. In a lease with option to purchase, the tenant is not committed to buying the property but has the right to do so if he chooses. In both cases, the buyer typically asks that a portion of his monthly rent be used as a credit towards the property purchase, notes FinancialWeb.