Since they are looking for 45k, we were thinking the interest due to the private investor for the 80k down payment would be their back-end non-refundable cost of the option (9.6k). 20-25% of the remaining amount (45k - 9.6k) would come out of the loan proceeds, while the remaining 75-80% would become an unsecured loan between us and Party A payable after closing if they exercise their option to purchase.If they don't exercise their option to purchase, the remaining amount due to them would become payable upon our sale of the home (whether or not we rehab it or sell it as-is at the later time).The tenant is currently paying 1800/mo rent - we would increase this to 1900 and would actually be cash flow negative roughly 250/month for the 18 months).If we ran our numbers properly (and you're still reading this --thanks, btw!)

You can tell a lot about the agent from that exercise. 

What RE focus do you wish to exercise?

If they choose not to exercise that right then they won't win damages later on for what they could have found but chose not to investigate.Now had they completed an inspection but the defect was not discoverable in such an inspection then they might win the argument.

The clause is rarely enforced, but it does happen so you need to be prepared to resolve it if the lender chooses to exercise their right to accelerate the loan.Simply put, whom ever holds the beneficial interest in the property, typically the owner, has the liability.

I'm glad I went through this exercise, it taught me a lot very fast. 

Some simple daily tasks include making my bed, 10 minute meditation, exercise etc, along with any real estate plans I have for the next day.

During the term of the lease you are given the ability to exercise your option to purchase for a previously agreed upon price.

John,As an exercise, I've used a couple generalized numbers.

This is an interesting exercise.