The option term is 30 years, but you can exercise the option to purchase at any time.

From above the equity at the end of the year if the tenant DOES NOT exercises whats in the the deal.$110k -90K + $5K = 25K.IS this correct.

I understand that this is a general rule of thumb when determining a properties feasibility but the 50% that gets carved off ultimately does get exercised during tenant occupation, correct?

But, it's a necessary exercise. 

The lease option money may be substantial.Buyer and seller may agree to a purchase price now or the buyer may agree to pay market value at the time the option is exercised.

The Realtor would help to negotiate lease terms, option fee, & hopefully stick around to assist with the sale afterward once the "tenant buyer" exercises the option.  

As a responsibly armed american, I can say without a doubt in my mind that if we don't exercise our rights we will lose them.

So giving the children a cash flow for long period of time makes more sense.Now there is a rule called "imputed interest" from the IRS, see http://thelawdictionary.org/article/what-are-irs-i...Comparing installment sales with reverse mortgages is an interesting exercise.  

Again, without fail, NONE of the ones that I leave messages for return the call......for over 6 days and counting.I also called some new ones the same day I called back the first batch and I am now tracking those but.......the trend is the same for the new ones as well.Of course, this exercise helps me eliminate those that I would never work with.

When the time comes to exercise the option, if the property has appreciated more than you projected, they are getting a good deal.