What is the difference between a lease option and a lease purchase?

A lease option gives the tenant the right, but not the obligation, to purchase the property at a predetermined price within a specified period. This arrangement allows the tenant to live in the property while having the opportunity to buy it later, usually after a set lease term. The tenant can choose whether or not to exercise this option, making it a flexible choice for those who may wish to test the property or their financial situation before committing to a purchase.

In contrast, a lease purchase agreement typically obligates the tenant to purchase the property at the end of the lease term, which may limit the tenant's choice compared to a lease option. This fundamental difference underscores why the lease option is viewed as a more flexible agreement, as it provides rights without obligations, allowing potential buyers to make a more informed decision.