Nobody has told them the truth to save them from failure.

Understand your local market, the economic drivers behind its success or failure and make your decision. 

Gave me the opportunity to see what success looked like, to learn from their successes and failures, to have in-person resources I could go to when questions or issues came up.So for me, having experience buying/owning a home combined with having local friends who can help are the two invaluable tools for what success I've experienced thus far.Hope that helps. 

Damage caused by failure of your water lines and fixtures may be covered by your insurance.  

Also consider that 3x systems provides 3x possible future failure points so this impacts your operating costs as well. #2 - might be cost effective although the times I've gotten quotes on this approach, I wasn't too impressed with options for control within different spaces (for instance if you have a single room studio, sure - however if you have a 2 bedroom deal you need some separate feeds and that's not what these are designed for)..

My sense is there's a reason for that.I'd be a bit concerned that some type of failure could result in water damage, in addition to the risks that you mentioned. 

Failure to memorialize the contract in writing does not remove any of your obligations to the tenant, however, absent a written agreement the "rules" of your lease will default to state law.

I will also post my progress of success and failure.

I am here to make connections and share my successes and failures just as those on here have done before me. 

Has had some past "credit event" like a bankruptcy caused by a divorce, business failure, or medical issue which they need to get some distance from before they can qualify for a traditional mortgage.Rent to own's are terrible for:1.