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Rental Application – This form is for Tenants to fill out in order for Landlords to get access to the potential Tenants credit, finances, and employment history.
Purchase Agreement – The contract becomes a purchase agreement if the Tenant decides to buy the property.
What to Include in an Alabama Lease-to-Own Agreement?
An Alabama lease-to-own (or rent-to-own) agreement lets a tenant rent a property with the option to buy it later. This type of deal includes parts of the regular lease with a purchase contract. It includes rent details, security deposits, late fees, and rules on occupancy, furnishings, utilities, and pets. The agreement covers maintenance, property access, and tenant rights if the landlord sells the property.
Lease Details, Option Fees, and Purchases
- Lease Details – The agreement should include the lease length, monthly rent, payment dates, late fees, and who is responsible for maintenance and repairs.
- Purchase Option – This gives the Tenant the choice (but not the obligation) to buy the property. It includes the purchase price, how to exercise the option, and any rent that goes toward the purchase price.
- Option Fee – Tenants pay a non-refundable option fee to have the option to buy in future.
Landlord-Tenant Laws, Terms, and Required Disclosures
- Landlord-Tenant Laws – Lease-to-own agreements are under Alabama’s landlord-tenant laws – the Uniform Residential Landlord and Tenant Act. It covers rental agreements, Tenant rights, and Landlord duties.
- Required Disclosures – Landlords must follow state and federal disclosure laws.
Attach Addendum
- An attached lease addendum includes the purchase option, price, financing, inspection period, any fixtures or personal property that come with the sale, rules on disputes, property safety, and lead paint disclosure.