But options work I think in Texas they have to be short term though.I am buying a 5.5 million dollar property that i optioned in 2009  I put 200k in cash up for option money ( non refundable) and i pay 120k a year in option payments ( non refundable) but its all a credit to the purchase price.. so i have no interest carry .. on a 117 acre parcel that once it comes into the city will be worth north of 50 million.. thats how you make money in the land game.. and sellers will understand.so as it comes to hawking beat up houses.. just put 5 to 10k in option money out make your monthly option payment have it all go to the purchase price and close in 60 to 90 days when you exercise your option.... although you will want to run this model by the state regulators they still may not like you publicly marketing the property.. 

Simply suggesting that folks engaged in working with investors, educating them don't know much about the project, are not educated, don't do their own due diligence, are not close to the operators or exercising a key role on the team is seriously missing the point.  

@Shannon Phillips, A great exercise for you would be to subcategorize "performance" into three categories.1.

But with the lease purchase considering only closing on the property for what’s left on that mortgage at the time i decide to exercise the right.Owner is willing to pay HOA for two years and payoff Heloc.

To throw numbers at this exercise, assuming the IRS/primary lien is 400K, the amount owed to the bank is 500K, and I made a bid at 600K and it was accepted, would 400K automatically go to the IRS to satisfy the primary lien, and then the remaining 200K would go to satisfy the bank mortgage? 

That exercise would be a lot more cumbersome if due dates were all different. 

It was renewed every year & after 12 years he finally exercised it & paid it off.

If I don't put any money into repairs (I've never seen the inside so I have no idea what condition it's in - this is just an exercise), I'm seeing around 15% cash on cash return.When estimating the rents, I went under what the seller had reported.

Let’s go through a few evolutions of this exercise. 

@Michael Hudelson - money can’t be your why, so let’s do this exercise.