The conversion is going to be expensive so I think I'm going to give them heavily discounted lease rate and have them pay for buildout.

I think if the numbers work then go for it-- I was commenting on the  actual conversation you were having with this lender.  

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Hey All,I've done some mailers to absentee and expireds for potential lease option / sub-to deals, but the list is way too big to mail out to all of them for my budget, but I want to be able to mail to them several ti...

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That conversation would focus on providing different scenarios for the PLs that might still be attractive to them but less onerous on you.