Can someone clarify this paragraph about Lease Option please?

[Maya A.]

Hello BP community!

Reading a book on Lease Options now and got stuck on this one example. Please help me understand what it means. 

Facts: Seller has a home worth $235,000 and will sell it to you for $225,000 on an 18-month option. 

"The seller owes $150,000 on their mortgage and agrees to take $75,000, less closing costs at the time of closing ($225,000 sales price less $150,000 current mortgage balance). This allows you to get the mortgage equity during the option period. The equity from the principal pay down during this option period is estimated at about $200 per month so $3,600 total during the 18 month term." - this is word for word. 

What do you guys understand from this paragraph?

[Greg Scott]

Explanation
So you take over the mortgage at $150K and pay them $75K down payment for a total of $225K which is the purchase price.

It is a bit sneaky but here they claim you get the seller to agree to pay all closing costs so you don't have more than the $75K out of pocket.   That is not common.  A seller may or may not agree to that.

The point of the rest of it is that at the beginning of a mortgage, most goes to interest and very little goes to reducing principal.  Half way through the loan, the principal paydown gets faster, so they are trying to point out that every month you own a higher portion of the property than you would with a brand new mortgage.

Commentary
In my opinion, that is a lot of brain damage and not great returns for $75K out of pocket and only $10K of equity capture at the start.  With $75K, you should be able to get 2 or 3 rental properties and capture $15K to $20K on each of them with straight up purchases. 

The only way the deal you described makes sense to me is if someone else is lending your a portion of the $75K down payment.  Of course you still have the risk of the due-on-sale clause.