Furthermore, if they are inebriated then the quality of work may be terrible and unsafe. 

Home prices being at an all time high in many areas, this also might not be a terrible thing.

It is better to do a deal than skip one just because the dollar amount for financing is high.Good luck in your search and know that if the numbers make sense, you have made the right choice.ya know I would have agreed with this pre 08  but these days most HML want good credit  and proof of cash reserves and cash down.. for inexperienced first time type buyers they may not even do one.. unless you have massive down and cash backing you up.. it gets very easy when your have a nice track record.. but most HML are not little down crappy credit no provable income.  

Your $10K down-payment also needs to be reflected in the Lease-Option Contract as being credited towards the $125K purchase price.

One guy has a great credit score, but recebtly lost his job after 12 years with his company.

Unfortunately, people generally are terrible multitaskers.

Any private lenders out there that can do something like this?

If you are leveraging the property, and the cash "in" is the DP (20%), then a property with only a 10% CoCR is a terrible deal.Since the CoCR is based on CASH, and most likely the income side is the cash flow, that cash flow should be the same for the next few years. 

I've read a number of threads with a lot of pros and cons to both but several threads mentioned they ended up with 5 yr term etc .. rather than a 30 year term.We have a great local credit union to work with that is easy to work with and has great rates.

I even tried withdrawing some credit from the Bank of Mom, but alas, the bank was tapped out and the best I could muster was about $2,000.