Non-refundable option fee - Posted by Fran CA

Posted by Tim on June 04, 2001 at 21:42:53:

Fran…I did a lease/purchase (as the optionee) when moving to Atlanta three years ago. I bought a $230k house, put $ 15k down (non-refunable) and closed in a year. Most of the experts seem to indicate a range of 3-7% of the purchase price is an acceptable option fee. You certainly need to get more than 5-10k.

Non-refundable option fee - Posted by Fran CA

Posted by Fran CA on June 04, 2001 at 21:36:47:

We are looking at doing our first lease option and would like to know what is a reasonable amount to get for the option fee? The strike price on the home would be 445K once the option is exercised. From what we have heard 10% is the norm, but 45K for an option seems a bit high. What would be the best way to handle a call we receive where the potential optionee can only put down 5 - 10K? Is that enough option money for a home worth 445K?

Has anyone ever gotten a option for more than 10K on a high priced house?

As always, thank you all for your help and support.


All things are relative … - Posted by JT - IN

Posted by JT - IN on June 04, 2001 at 23:41:29:

For a homeowner that can afford to live in a $ 445K home, an option fee of $ 15 to 25K (3 to 5%) should be no problem. If it is, you have the wrong T/B.