Lease Option Calculator — Free Rent Credit & Assignment Profit

A lease option is control: a fee, a rent, a credit, and a future price. You either exercise into that price, assign the contract, or learn you paid for a call option that expired.

Value today is the honest as-is number. Option price is what you have the right to buy at. If option price is way over today's value, you need appreciation or credits to make exercise sane. Option fee is the cash you pay for that right. Rent and credit percent create a monthly rebate toward basis. Term in months is how long the clock runs. Appreciation is an annual rate compounded over that term so you can see a projected value — not a promise from the market.

Rent paid is rent × months. Credits are that amount times the credit percent. Effective price is option price minus credits. That is the number you would basis into if you exercise. Projected value compounds today's value. Profit if you exercise and flip is projected value minus effective price minus the option fee. Profit if you assign is the assignment fee plus credits — a simple view of walking away paid for your time without taking title.

Break-even all-in is effective price plus option fee: what you have to clear on a sale the day you take title if you want to not lose cash. If projected value is under that line, you are speculating on a hotter market than you typed.

Credits only help if they are in the contract and the seller honors them at closing. A handshake credit is a story. Type the percent that is written. If the credit is zero, this is just a lease with a call option bolted on. Price it that way.

Assignment fee is not automatic. It depends on whether the option is assignable. If it is not, that profit path is fiction. The calculator will still do the arithmetic. You have to do the contract.

Use wholesale when you are assigning a purchase contract instead of an option. Use seller finance when the exit is a note rather than a lease. Use fix-and-flip if you will fund a rehab after exercise. Different contracts, different clocks, same habit: type the ugly version first.

The identities

Effective price = Option price − (Rent × Months × Credit%)
Projected value = Value today × (1 + appr%)^(months/12)

Exercise profit = projected value − effective price − option fee. Assign profit = assign fee + credits.

How people blow the result

• Counting credits that are not in writing.
• Using 8% appreciation in a flat zip code to rescue a fat option price.
• Assuming every option is assignable.

FAQ