Food lease: what is it?
Few people know about the food lease. However, in some cases, it can be very useful. What is that ? How it works ?
What’s behind the “food lease”? If we know the farm lease or the rehabilitation lease, the food lease is “characterized by the obligation contracted by the purchaser to provide for the life and needs of the author of the alienation, especially, by providing him with the supply and payment of his food”as indicated by site Dalloz.
What is a Food Lease?
In other words, when a Property is sold with the addition of a food lease, the buyer will be obliged to take care of the small daily details of the seller. All the vital needs (medical care, foodstuffs, clothing, outings, etc.) of the latter must be taken care of until his death, hence the name “food lease”!
In this, the food lease looks a bit like life annuity. For the jurist Jean Carbonnier, nicknamed the Doyen, this annuity is reminiscent of a “kind of adoption of old people”.
When the total maintenance of the lessor is ensured, cohabitation is not compulsory. It is possible to convert part or all of the sum of the sale into an obligation of maintenance and care, therefore a food lease. The food lease can be a solution for the elderly who live alone and need care and maintenance, and who cannot rely on their loved ones. The latter can then choose a trusted person to house them and take care of them until the end of their lives.
In practice, it is rare to find sales contracts with food lease in urban areas, because the constraints are multiple.
Food lease and inheritance
“The sale with food lease gives rise to the classic transfer rights of approximately 7%, based on the total price of the property, including the assessment of future care and services. The transfer duties for a sale with a food lease are much lower than the inheritance tax, especially when the heir is not a child of the deceased. It is possible to sell to a child but the other children must accept this sale before a notary”we read on the site specialized Expert-Invest.
