This means they may  choose to exercise the option or not choose to exercise it. 

You are not obligated to purchase the lien for all 3 years on that case, you can purchase only one year and whoever buys the consecutive years will have to buy your lien out before they can exercise their right to foreclose assuming the lien is never payed by the owner. 

Anyway, use this opportunity as an exercise to prepare yourself for the real deal.  

It is the owner exercising their right to terminate the rental agreement.

The "extra" rent that you pay above the fair market rent can be applied towards the purchase price of the home IF you decide to exercise your option to buy as well.  

Take it with a grain of salt and exercise your own judgment.Roofstock closing coordinators:I’d say if you’ve never bought a property in your life, the Roofstock closing coordinators may be helpful.

., incentivize by saying the purchase price will be $285,000 if they exercise their option on or before 2 years, or negative reinforcement by having set rental increases if they do not exercise the option by x date?

It gives me a good picture of the cash-flow in the most recent fiscal period (typically a year), but to carry that forward 2, 3, 5 or 10 years encompasses as many assumptions and predictions as does calculating an internal rate of return.Now, you can discount future cash flows and endeavour to calculate a series of CoC values ... or, perhaps an average CoC over a period of time ... but you are now getting into an exercise which is not entirely different than determining/projecting a rate of return :-)  Naturally the cash return is a component of overall rate of return."

@Brendan JacksonI think going about it the manual at first can be a helpful exercise.

He has no heirs, and beyond the age of having any, so if he passes away before I exercise it what happens to the option?