Legal Question in Real Estate Law in Missouri

Re: Rent to Own - Owner Financing

What is informally known as a "rent to own" contract is usually, in more precise terms, a lease with an option to buy. You'll really need advice from an attorney licensed in Missouri to give you a dependable response, because there are at least two concepts here where state laws and practices may vary - the lease itself and the option agreement. Sounds like you also have a financing agreement to wrap in to the package.

In case your question doesn't draw a response from a Missouri lawyer, I can at least point out a few aspects, based on California law and experience, that might translate well.

First, options must be exercised in pretty strict accordance with the option agreement, or the exercise may be ineffective and right to exercise may be lost. Never be a day late or a dollar short; cross your t's and dot your i's in exercising your rights under an option. This in turn suggests writing them in very clear, precise language, specifying when the option may be exercised, where and how; what might invalidate the option prior to exercise, such as late rent payments, if anything; how much rent, if any, is credited to the option price; the down payment; and where owner/seller financing is offered, the full terms should be spelled out beforehand, such as interest rate, credit worthiness considerations, if any, term, balloon payments, etc.

I would recommend having a Missouri lawyer working for you either write the agreement or review anything written by the other party to the deal.

Either party can draw up the papers, and rather than submitting an offer, if time permits I would negotiate all the terms in one or more negotiating sessions, then both parties make a list of the terms and give them to your lawyers to write up in accordance with the results of the negotiation.

The trouble with submitting an offer is that it may and probably should cover a couple dozen separate matters, and if the offeree agrees to 90% of them but not the other 10%, you will be exchanging paper for weeks until you achieve agreement on everything. It is better to spend an hour on a long-distance call, on line or face to face and get everything worked out.