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Lease To Own Property Agreement for Indonesia

Lease To Own Property Agreement Template for Indonesia

A comprehensive legal agreement governed by Indonesian law that combines both lease and purchase elements for real property transactions. This document establishes the terms under which a tenant leases a property with the option to purchase it at a predetermined price within a specified period. The agreement complies with Indonesian property laws, including the Basic Agrarian Law and relevant property registration requirements, while protecting both parties' interests through detailed terms covering lease payments, purchase options, maintenance responsibilities, and transfer of ownership procedures.

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What is a Lease To Own Property Agreement?

The Lease To Own Property Agreement is a specialized legal instrument used in Indonesian property transactions where the owner wishes to lease their property while giving the tenant an option to purchase it in the future. This arrangement is particularly useful in situations where immediate purchase isn't feasible or desired, but there's a mutual interest in eventual ownership transfer. The document structure follows Indonesian legal requirements, including compliance with the Basic Agrarian Law, Civil Code, and property registration regulations. It covers essential elements such as lease terms, purchase price, payment schedules, maintenance responsibilities, and conditions for exercising the purchase option. This agreement type is commonly used in both residential and commercial property transactions, providing flexibility while ensuring legal protection for all parties involved.

What sections should be included in a Lease To Own Property Agreement?

1. Parties: Identification of the Owner/Lessor and Tenant/Prospective Buyer with complete legal details

2. Background: Context of the agreement, including property details and parties' intentions for lease-to-own arrangement

3. Definitions: Key terms used throughout the agreement including Property, Lease Period, Purchase Option, and Payment Terms

4. Lease Terms: Duration of lease, monthly payments, and conditions of occupancy

5. Purchase Option: Terms and conditions for exercising the purchase option, including purchase price and credit of lease payments

6. Payment Structure: Detailed breakdown of lease payments, option fees, and purchase price calculations

7. Property Maintenance and Repairs: Responsibilities for maintenance, repairs, and improvements during the lease period

8. Insurance and Taxes: Requirements for property insurance and responsibility for property taxes

9. Default and Remedies: Consequences of default on lease payments or breach of agreement terms

10. Exercise of Purchase Option: Process and requirements for exercising the purchase option

11. Transfer of Title: Procedures and requirements for final property transfer

12. Representations and Warranties: Legal statements and guarantees from both parties

13. Governing Law: Specification of Indonesian law application and jurisdiction

14. Execution and Registration: Requirements for notarization and registration under Indonesian law

What sections are optional to include in a Lease To Own Property Agreement?

1. Property Management: For properties within managed complexes or apartments, detailing management arrangements and fees

2. Subletting Provisions: If subletting is to be permitted during the lease period

3. Early Purchase Option: Terms for exercising the purchase option before the scheduled end of the lease

4. Property Development Rights: For properties where development or major modifications may be considered

5. Strata Title Provisions: Specific provisions for apartments or properties under strata title

6. Foreign Ownership Provisions: Special conditions if the prospective buyer is a foreign national

7. Agent Involvement: Terms regarding any property agent's involvement and commissions

8. Financing Conditions: If the purchase is contingent on obtaining specific financing

What schedules should be included in a Lease To Own Property Agreement?

1. Property Details: Detailed description of the property including certificates, boundaries, and fixtures

2. Payment Schedule: Detailed breakdown of all payments including lease payments, option fees, and purchase price

3. Property Condition Report: Initial condition assessment and documentation of the property

4. Land Certificate Details: Copies and details of land certificates and ownership documents

5. Building Permits: Copies of relevant building permits and certificates

6. Maintenance Schedule: Detailed maintenance responsibilities and schedules

7. Insurance Requirements: Specific insurance requirements and coverage details

8. Property Tax Records: Current property tax assessment and payment history

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Indonesia

Publisher

Ƶ

Cost

Free to use
Relevant legal definitions

















































Clauses







































Relevant Industries

Real Estate

Property Development

Residential Property

Commercial Property

Property Management

Banking & Finance

Legal Services

Property Investment

Construction

Housing Development

Relevant Teams

Legal

Real Estate

Property Management

Finance

Compliance

Operations

Asset Management

Facilities

Contract Administration

Investment

Risk Management

Relevant Roles

Property Manager

Real Estate Agent

Legal Counsel

Property Developer

Finance Manager

Asset Manager

Investment Manager

Property Administrator

Compliance Officer

Real Estate Investment Officer

Facilities Manager

Contract Administrator

Real Estate Operations Manager

Property Acquisition Manager

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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