Lease with Purchase Option, also known as leasing, is lease financing that makes it possible to purchase a good when payment of monthly payments and other conditions are met. More information at fondobook.com
Quite similar to credit conventional consumption, your monthly payments called rents in case of LOA (Rental with Purchase Option) depend on the value of the property, the duration of the contract, the interest rate and your personal contribution. Unlike a credit agreement, this financing is a lease agreement that provides for a purchase option by the customer at the end of the contract.
The benefits of this financing
Monthly payments of the Rental with Purchase Option (LOA) are generally lower than those of a conventional credit because throughout the duration of the contract the property remains the property of the financial institution, the customer is tenant of the property. He can become the owner of the property at the end of the contract by fulfilling the purchase option defined during the subscription to the offer. This makes this type of borrowing all the more interesting.
Conditions of the Rental with Purchase Option
Before 2013, the leasing was rather assigned to vehicles. However, it is now starting to be offered in other markets. Its constraints remain however the same. You can not become the owner of the property for which you are renting until the last rent and the purchase option are paid. Throughout the duration of the contract, the borrower agrees to bear all the expenses inherent in the maintenance of the property under the same conditions as an owner. In the event of return of the property, the borrower will also have to bear the costs of restoration if necessary.
How to choose?
Would you like to take advantage of this solution to acquire a new car? Know that financial organizations can study with you different financing solutions: LOA or conventional loan. To find out which solution is best for you, consult your Pre-finance financial advisor who will guide you to the best choice for your situation.