Lease with option to purchase:
tenant may or may not decide to buy the property, but pays a fee to owner (option fee) in order to have the first right to buy the property from the owner at a specific price, on specific terms, by a specific date. If the tenant doesn't exercise the option (that is, buy the property) within the option period, tenant forfeits the option fee paid but continues to occupy the property in accordance with the terms of the lease. Owner can then sell to someone else with the tenant in place, unless the lease has run out.
Contract for deed: buyer (who may or may not occupy the property) signs an agreement with the owner whereby buyer commits to buy the property and pays owner whatever amounts of money over whatever time on account of the purchase price until a specific point in time when owner conveys title to the property to the buyer in exchange for buyer paying owner the balance of the purchase price.
Here are my definitions based on PA:
Lease with option to purchase:
tenant may or may not decide to buy the property, but pays a fee to owner (option fee) in order to have the first right to buy the property from the owner at a specific price, on specific terms, by a specific date. If the tenant doesn't exercise the option (that is, buy the property) within the option period, tenant forfeits the option fee paid but continues to occupy the property in accordance with the terms of the lease. Owner can then sell to someone else with the tenant in place, unless the lease has run out.
Contract for deed: buyer (who may or may not occupy the property) signs an agreement with the owner whereby buyer commits to buy the property and pays owner whatever amounts of money over whatever time on account of the purchase price until a specific point in time when owner conveys title to the property to the buyer in exchange for buyer paying owner the balance of the purchase price.
did you read this
http://www.thecreativeinvestor.com/modules.php?op=modload&name=Forum&file=viewtopic&mode=viewtopic&topic=20031&forum=34&start=0
http://www.thecreativeinvestor.com/ViewTopic21578-34-4.html