Document background
The Lease Option Agreement is a sophisticated legal instrument used in the Philippines when a property owner wishes to lease their property while simultaneously granting the tenant an exclusive right to purchase it during or at the end of the lease term. This document type is particularly valuable in situations where potential buyers need time to arrange financing or want to "test" the property before committing to a purchase. The agreement must comply with Philippine Civil Code provisions regarding both leases and options, as well as relevant real estate laws and regulations. It typically includes detailed terms about the lease arrangement, purchase option terms, property maintenance responsibilities, and the mechanism for exercising the option. This document is commonly used in both residential and commercial real estate transactions, providing flexibility for both parties while establishing clear legal rights and obligations under Philippine law.
