How does it work? What is a lease option?

You are leasing or renting a property with an option to buy it at a future date.  You pay a nonrefundable fee (option fee) that gives you the right to purchase the property. The future price of the property is set at the time the lease-option is signed.  

The nonrefundable option fee amount varies from property to property.  The monthly payment is larger than normal rent and a portion of the excess is used toward the closing costs of purchasing the home.  In some cases, some of the option fee can be applied toward the down payment for the later purchase of the home.