Lease To Own Agreement for Nigeria

Lease To Own Agreement Template for Nigeria

A comprehensive legal agreement governed by Nigerian law that combines elements of both a lease and a purchase agreement. This document establishes the terms under which a tenant rents a property while simultaneously building equity towards its purchase. It details the lease period, purchase option terms, payment structure (including rent and purchase credit allocation), maintenance responsibilities, and conditions for transferring ownership. The agreement must comply with Nigerian property laws, particularly the Land Use Act of 1978 and relevant state-specific property regulations, while providing clear mechanisms for both the lease period and the eventual property transfer.

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What is a Lease To Own Agreement?

The Lease To Own Agreement is a specialized legal instrument used in Nigerian property transactions where traditional property purchase methods may not be immediately feasible. This document is particularly relevant when buyers need time to build equity or secure financing while occupying the property, or when sellers prefer a gradual sale approach. It combines rental agreements with purchase options, structured under Nigerian property law, particularly the Land Use Act of 1978 and state-specific regulations. The agreement typically includes detailed sections on property description, payment terms, maintenance responsibilities, purchase option specifics, and property transfer conditions. It's commonly used in both residential and commercial property transactions, requiring careful consideration of local property laws, registration requirements, and financial regulations to ensure enforceability and protect both parties' interests.

What sections should be included in a Lease To Own Agreement?

1. Parties: Identification of the Owner/Seller and Tenant/Buyer with complete legal names and addresses

2. Background: Context of the agreement, including property ownership status and parties' intentions regarding the lease-to-own arrangement

3. Definitions: Key terms used throughout the agreement including Property, Lease Period, Purchase Price, Option Fee, etc.

4. Property Description: Detailed description of the property including address, boundaries, and registration details

5. Lease Terms: Duration of lease, monthly payment amounts, and allocation between rent and purchase credit

6. Purchase Option: Terms of the purchase option, including option fee, exercise period, and purchase price calculation

7. Payment Terms: Details of all payments including rent, option fees, purchase price, and payment methods

8. Maintenance and Repairs: Responsibilities for property maintenance during the lease period

9. Insurance and Property Taxes: Requirements for property insurance and responsibility for property taxes

10. Default and Remedies: Consequences of default by either party and available remedies

11. Property Transfer: Process and requirements for final property transfer upon option exercise

12. Governing Law: Specification of Nigerian law and relevant jurisdiction

13. Termination: Conditions and process for agreement termination

14. Notices: Methods and addresses for formal communications between parties

What sections are optional to include in a Lease To Own Agreement?

1. Property Management: Include when the property is part of a managed complex or estate, detailing management rules and fees

2. Subletting Prohibition: Include when subletting needs to be explicitly prohibited during the lease period

3. Environmental Matters: Include for properties in environmental sensitive areas or with specific environmental concerns

4. Right of First Refusal: Include when giving the tenant priority rights if the owner receives other purchase offers

5. Home Business Use: Include when allowing or restricting business activities in the property

6. Improvements and Alterations: Include when specific rules about property modifications need to be established

7. Co-signer Requirements: Include when a guarantor or co-signer is involved in the agreement

What schedules should be included in a Lease To Own Agreement?

1. Schedule 1 - Property Details: Detailed property description, including plans, boundaries, and included fixtures

2. Schedule 2 - Payment Schedule: Detailed breakdown of monthly payments, including rent portion and purchase credit portion

3. Schedule 3 - Property Condition Report: Initial condition report with photographs and notation of any existing damage

4. Schedule 4 - Maintenance Schedule: List of regular maintenance tasks and responsibilities

5. Appendix A - Required Insurance Coverage: Detailed insurance requirements and minimum coverage amounts

6. Appendix B - Property Title Documents: Copies of relevant title documents and land registration certificates

7. Appendix C - Option Exercise Form: Template form for exercising the purchase option

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Nigeria

Publisher

Genie AI

Document Type

Rental Agreement

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Real Estate

Property Development

Financial Services

Legal Services

Property Management

Housing Finance

Construction

Residential Property

Commercial Property

Banking

Relevant Teams

Legal

Real Estate

Property Management

Finance

Compliance

Risk Management

Business Development

Operations

Asset Management

Contract Administration

Relevant Roles

Real Estate Agent

Property Manager

Legal Counsel

Property Developer

Financial Advisor

Mortgage Broker

Housing Finance Specialist

Contract Administrator

Real Estate Investment Manager

Property Rights Lawyer

Conveyancing Officer

Asset Manager

Property Portfolio Manager

Compliance Officer

Real Estate Transaction Coordinator

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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