Part of the motivation for congress writing Dodd Frank was to clamp down on the investors offering preditory terms re  rent to own and seller financing and that view has carried into craigslist rent to own adds and you say zillow. 

I offered her before this event to move out and honor deposit back even contract building is 6months lease also wafted some negotiation with HoA they offered to move her to alternative unit.

Being that rates are up it's another way to offer exatly what you mentioned; the chance to own for a couple hundred bucks more than renting.Thoughts?

Does anyone have experience with banks that offer these without fees? 

I initially offered $200K in cash, but the seller countered at $240K.

Your son is likely paying more than the property is worth, by definition, as the seller would almost certainly prefer a similar offer that was not subject to. 

Imagine if it cost 1000 to send out 50 letters but half of them responded and half of those wanted an offer and half of those accepted an offer and half of those closed and half of those resold for a net 50k. 

However, many lenders offer only the 7A, so you'll have to shop around.

They are being offered discounted rent, free gym memberships, free cable, etc.

Also review what others offer.