An Arkansas rent-to-own agreement provides tenants with the opportunity to lease a property and the option to potentially purchase it at a predetermined price. This arrangement is designed for individuals facing challenges in qualifying for a traditional mortgage. It introduces financial flexibility by allowing a portion of the monthly rent to contribute towards the property’s future purchase.
In addition to the agreement, prospective tenants often need to complete a rental application to begin the leasing process. This helps landlords assess the tenant’s eligibility and background before entering into the agreement.
Tenants are not compelled to finalize the acquisition, but any deposit and down payment submitted towards the prospective purchase become non-refundable in the event the tenants opt not to proceed. Should they decide to move forward, they will then enter into a residential purchase agreement, which outlines the terms and conditions of the property’s sale.
Landlord-Tenant Laws: Title 18, Chapter 16 (Landlord and Tenant) and Title 18, Chapter 17 (Arkansas Residential Landlord-Tenant Act of 2007).
Purchase Agreement Laws: Title 18, Chapter 12 (Conveyances).
