After 24 months I will either assume 100% of mortgage cost or have to exercise my option and purchase the property for remaining mortgage balance.

Then on exercise of the purchase option you can get him his 50% (with the idea that in the meantime cash flow has increased and a good loan is more likely).

If the buyer/tenant doesn't exercise their Option, and the term of the Option is over, then the OC is not refundable. 

Each sold the other one options to purchase their house for 25k, 5 k for the option. then each exercised the option, sold the house, and presto an IRA with 5 k in it now had 75k in it!

You may exercise this right of call anytime during the thirty (30) day period immediately following the fifth (5th) anniversary date of the loan and at any time during the thirty (30) day period immediately following each fifth (5th) year anniversary date of the loan thereafter.If you exercise Your right to call the loan, I WILL BE REQUIRED TO PAY THE LOAN IN FULL (OR ARRANGE NEW FINANCING) BY THE CALL DATE.

Unlike the TI the property owners own an interest in the trust itself rather than the underlying property making it easier or the trustee to exercise control of the underlying property. 

SierrahThe game is listed versus unlisted properties, so most agents are going to stick to the listing terms, x percent of the option money, their 6% down the road when the option is exercised.

I would read the servicing agreement and see if there is any language there that would prevent you from exercising your rights as a lien holder as you see fit.  

The point of this exercise is - look at all of the terms of your offer.

There are many other ways to play with the numbers and I'll leave that exercise to you - it's all just math.