Im not against options, just be careful, the reality is very few people exercise their option, like 2-5% (they just cant clean up their credit and save) and tend to forfeit their option money, even though you have a contract, do this a few times, and you will build a reputation, and not a good one even though what you are doing is legal, and everyone consented you will still be considered the bad guy for taking their option money.

Super fun exercise...

Make it about $200 more if market rent is a $1000 or $1100) The option should be exercised within 1-2 years.

It’s a great way to learn more while doing other things such as exercising, driving, etc.Get involved with a local REIA groups.

When the tenant buyer exercises the Option to buy a few years later, generally that has bought down our underlying financing and we split those profits 50/50 as well.

An option is an automatic out because you don't have to exercise it if you don't want to, and if you find a buyer you just sell them your option.

I was given a 12 month redemption period in which I tried to exercise but the HOA evicted me from the property and when I set up a Short Sale with my lender they would not let me access the property. 

Having Tenant Buyers is good cash flow until they exercise their option.

They finished rehab work and 2 yrs later exercised their option at 85k - 10k option fee= sold for 75k.

I echo two things Ryan has said: This business is reallybuilt on reputation -- so take the time it takes to buildit carefully, and secondly, exercise real caution.Caution doesn't mean not ever doing a deal.