They typically want massive down payments (25%+) and will only give you 12 months max to exercise your option.Your goal as a lease option investor is to get into the property with as little out of pocket as possible (ideally $0) with a below market rent and a below market purchase price with as much time to exercise as you can get.

The agencies we use to pull credit histories on applicants (TVS, RentCheck) perform "soft" inquiries.

-> I totally agreeMy personal preference is month to month lease.I'm not every tenant best fan since I perform drive by or walk exterior of properties at least twice a month

I don't like those types of arrangements even if allowed in that particular state.Instead you can still get full commission by having contract wording that the one person you represent is your client and the unrepresented party or the one you do not represent is only a customer that you are performing ministerial acts for and not fiduciary acts. 

I have one of my ex-homes in my rentals (located in Claremont) and it is my worst performing rental by far. 

Is this the addendum that generally comes after the contract when inspections are performed?

If the other product doesn't meet the same performance requirements then its not "or equal". 

When a repair is needed that is beyond what he can perform, I still have a knowledgeable person overseeing the work of others that I have no relationship with.

My company buys 1st lien non-performing notes.

I have experience in rehabs and short sales but never in acquiring a property through buying a non-performing note directly from the lender and then foreclosing.