Lease option law in texas

Are you able to lease option a home in texas, or is it a law against it know? If it is a law against it, is it a loophole in the law?

The reason i am asking, because i see people in houston, texas still doing lease options, and if you can still do it legally, i want to do it also.

Check out this thread for starters:;action=display;threadid=6737

There is more on this topic if you search the archives.

Good luck!

Valgolas - Great avatar!!! I guess I need to set one up one of these days.

Lindsey - I signed up for more information about L/O’s in Texas at Basically, here is my interpretation of the information I received. Note: Consult with a RE attorney before engaging in any of these techniques.

  1. The legislation defines a lease/option as “an option to purchase real property that includes or is combined or executed concurrently with a residential lease agreement”. The beneficial interest of a land trust is not “real property”, it is “personal property”. Therefore, give your tenant buyer an option to buy the beneficial interest in the land trust that holds title to the property instead of giving them the option to buy the property itself. This would effectively give them an option to buy “personal property” instead of “real property”!!! [Note: This paragraph was quoted directly from the information I received.]

  2. Owner finance using an All-Inclusive Trust Deed (AITD) or a wrap-around mortgage (a “wrap”).

  3. Structure your deal so that the lease and the option do not exist concurrently. Also, make the option period no longer than 179 days. If the TB does not exercise the option in that period, cancel it.

Agian, though, consult a RE attorney first!