Tenant is family, seeking to break lease. Please advise.

[Diane S.]

Hi.   I'm looking for some advice on where to go on this one without further damaging relationships, and not putting our family in a major financial hole.  Here is the shortened version of the story:

About 4 years + ago, my husband had a job opportunity which moved us out of state.  Some close family members were newly married and wanted a chance to live in the house and eventually buy it.  Win win, so we thought.  We structured a legal lease agreement for the first year, which they resigned a second year.  All the while working (so they said) to get their credit in order to purchase the house.  Fast forward to about a month ago.  We had let them live in the house a couple of months lease-free just while we renegotiated the new lease.  This time, they wanted more ownership and agreed to a lease purchase.  We were holding a portion of their money to go directly toward the home.  Again, all of this is in writing, which they signed.  There was no clause for breaking the lease, only language which stated that at the end of the lease if they decide they no longer want the home, we keep the money they were putting down on the home.  Basic stuff.

Well, family member and I got into an unrelated argument, and they have decided on a whim that they want to move out ASAP, consequences be damned.  She is making countless demands, such as: we need to be leaving within this month, you cannot keep us paying for a place we don't want, we will NOT be living here when workers come in,  we will NOT put our son's life in danger from paint fumes (do not even get me started on that), and when I told her that the lease is legally binding, she said it wasn't because we allowed a lapse a few months back.  Not sure what that has anything to do with the newly signed document, we were just doing them yet another favor.

We are already hurting financially.  We have a chronically ill child, insurance is sky high, we cannot afford them to leave us with two mortgages.  I feel sick over how much money we poured into this property for them only to randomly turn around two weeks after signing the lease, after living there for nearly 5 years, and say they are done and that we need to "consider their family's needs." 

I am trying to distance myself emotionally from this (I'm white hot mad right now), and I know that being done with them financially is best for all, but what can we do legally?  What steps should we take?  

I appreciate it if you took the time to read all of this!  Sorry for the length.