Application Receipt Agreement-lease option

Application receipt agreement: gives you time to rethink

When the buyer wants to reserve a property for buying it till he can arrange for finance to pay in full he must sign an application receipt agreement. This is an agreement that entitles the buyer to make a choice for the buying of the property and keep it frozen for himself till he can arrange for the finances. This fee may be the application processing fees and is non-refundable. Only thing to be happy about it is that if at all you stick to your decision of buying the property finally this amount will be included in the final price of the property.

There are two clauses to this agreement

• If the applicant changes his mind and decides not to buy the property then the amount that was submitted will be forfeited and no refunds will be made. It will not be obligatory to make the purchase but if you do not buy the property according to the agreement your deposit will be forfeited.
• If at all the application is not accepted or the applicant could not arrange for the finance, the deposit money is refunded. The expenses such as appraisal fees, survey fees and other such expenses will be deducted before returning the deposit.

This agreement is an instrument that gives you the time between selecting the property and arranging finance for the purchase. This time can also be used to think over the decision and does a thorough background check so that you make informed decision.

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Sample Template Preview

The Pinnacle Group LLC
APPLICATION RECEIPT AGREEMENT

RECEIVED the total sum of $_____________, consisting of a $____________ non-refundable application fee and a reservation/earnest money fee of $______________ to reserve the property known as ________________________________ ______________________________________________. The undersigned expressly agree that if application is approved they herewith agree to accept the property under the terms stated below and all funds will be applied toward the move-in costs or Down Payment (in the case of a purchase agreement).  Management will process application as timely as possible and Applicant may be notified of the results by telephone, fax, or mail.  If the applicant(s) change their mind about occupying or buying the above named property OR do not provide the required information immediately upon request to process the application, OR if they do not pay the required move-in amount and occupy the property by the date as shown below, the applicant(s) will forfeit the entire deposit as liquidated damages since other prospective purchasers/tenants may have been turned away and it will be necessary for Management to re-advertise the property and evaluate other Applicants.  The applicant(s) are accepting the property in an “AS IS” condition except for the following: ___________________________________________________________________________________ .  If the application is denied, or Applicant is unable to secure financing, we will refund the reservation/deposit fee less any out-of-pocket expenses such as fees for appraisals, surveys, inspections, credit reports, or any other fee applicable due to processing the application.  Management shall not be responsible for any additional repairs and/or improvements to the property.  However, Management may take care of non-operable items as long as it is reported to Management in writing within seven (7) days from the date of occupancy unless this property is part of our Work For Equity Program, whereby Applicant(s) will be responsible for all repairs.

I (we) declare that the Application is complete, true and correct and I (we) herewith give my (our) permission for anyone contacted to release the credit or personal information of any of the undersigned Applicant(s) to Management and their Authorized Agents, at any time, for the purposes of entering into and continuing to offer or collect on any agreement and/or credit extended.  I (we) further authorize Management or their Authorized Agents to verify all application information including but not limited to contacting creditors, present or former landlords, employers and personal references, whether listed or not, at the time of the Application and at any time in the future, with regard to any agreement entered into with Management.  Any false information will constitute grounds for rejection of the Application, or Management may at any time immediately terminate any Agreement entered into in reliance upon misinformation given on the Application.

TERMS:    Sales Price $ _________________    Scheduled Closing or Move-In Date: ______________________

o Owner Finance at _________% Interest, Amortized for __________ years, with a  ____________ year balloon

Down Payment $___________  Approx. Prepaid Expenses $_________ (1 yr. Hazard Insurance and HOA, 1 mo. escrows)

Approx. Cash Required to Close $____________ Approximate Monthly Payment: $____________ (Includes Escrows)

o Lease with Option To Buy    Total Move-in $ __________    Monthly Rent $__________ Monthly Option $__________

o Rent Only    Monthly Rent $___________        Security Deposit $_____________    Pet Deposit $___________

Other Terms:  __________________________________________________________________________________________

__________________________________________________________________________________________

First Payment Due: _________________________

_________________________________    __________________________    ____________________________
Applicant            Date        Social Security No.            Driver’s License Number/State
_________________________________    __________________________    __    ______________________________
Applicant            Date        Social Security No.            Driver’s License Number/State
_________________________________
Management’s Representative      Date