If you do not get anything else from this chapter, please get this: Always use separate lease and real estate option agreements to document your lease and option transactions. And never, ever use a standard lease-option agreement, which includes both the lease and the option to purchase in the same agreement. That is a big no-no. Why is that? Because under the terms contained in a standard boilerplate lease-option agreement, once the lessee-optionee defaults on the lease and is evicted, the option agreement becomes null and void, too. However, when you use separate lease and option agreements, the option agreement will not automatically get wiped out if you default on the terms of the lease agreement and are evicted. The separate option agreement will still be valid until it is exercised or expires. And you will still have an opportunity to profit from the house under option. Also, in order to use the lease and option strategy that I am telling you about in this chapter, both your lease and real estate option agreements must include assignment clauses that allow you to sell your agreements to a third party without the property owner's permission.
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