If the tenant walks away without exercising the option, you keep the money. 

That seems to me as a first time buyer as a low ball, but the return is not very great for any prospective buyer at the current asking price, in my opinion. 

Unfortunately, (or thankfully for me) I've never had this happen and don't know who to call, but wondering if the mgt co dropped the ball here??

I might have low balled it too much, I was going with conservative numbers.At least I got out there found a property and made a offer, so it was good experience.

A month ago we put a cash offer on a property to flip. Offer was accepted but my normal title company was swamped so I went with another office. Closing is supposed to be today at 4:30 and come to find out the title c...

Until you generate leads and talk to sellers, this is all just an academic exercise. 

We like low-balling REO's because, unlike private sales, the seller doesn't get offended and listing agents are used to it.  

@John Upperman  for ONE HALF of percent of return.. this is an absolute no brainer you go local.. you will lose that half of % just travelling to Memphis.. and I am sure your not going to buy a quarter million dollars worth of RE without eye balling it.

I just went through this exercise and determined increasing my insurance liability limits to $1 mil on both of my places was a better option.  

One of my issues with the gum balls is they have a ceiling that is hard to raise.