Have them sign a one or two year lease with option to purchase, collect an up front option fee and charge them a premium rent rate (a portion of which could be credited back to them toward down payment if they exercise the option).

Anyone that needs three can live in four and have an office, storage, exercise room, etc. 

If the strike price is for less than the loan you are just going to have some seriously pissed off buyers when they can't buy the house when they exercise the option.  

Mainly because rates are low, rents are high and it's generally easier to evict rather than foreclose.Hypothetically:100k house rents at $950 give or take depending on area.Lease option gets you $950 and $3k in option money, plus some back end money if the exercise the option.Sell it at 10% down and finance the rest at 6% and you're getting $450 a month in interest, plus the p&I payment.

As an alternative, you can probably insert an early termination fee amount so it provides flexibility for the tenant to leave without having to deal with subleasing issues; however, you'd have to consider worst case scenario: Tenant exercises the early-termination option in December, which places you in a tough situation as a landlord in the Chicago area. 2.  

You may be speaking about buying a property "Subject to" the existing loans, or"Lease with an Option to Purchase" which is just that, you lease the property for a specified period of time, during which you can exercise the Option to Purchase and buy.

I currently am an exercise student.

I simply take over the deed/note, start making payments on behalf of the seller and have conditions/exit strategies in place just in case the due on sales clause (DOS) clause is exercised to prevent the original seller from facing a financial crisis if it defaults.

After the end of the lease option the tenant could exercise his option to buy.  

It would be a good exercise and possibly helpful to those who are new.This house is located in Texas and is a 3/2 @ approximately 1,100 sqft.