Hello, I’m a Nurse in Texas. Me and my wife purchased a property from a relative that we want to rehab for our first rental. Would like to use this to get started real estate investing. We have no debt on this propert...

We converted 2 of our houses to STR's when tenants broke their leases during the winter. 

We are going to do a lease option to our current tenant.

Rather they are showing a 'proposed financing'.They are NOT guaranteeing that you will find this (LTV, Rate, Term) or any other aspect of a loan (fees, commissions, etc).Leaving the loan aside, I can't help but make a couple of comments regarding the numbers;- Vacancy of just 5% means that if you have 1 move out in a year and it takes you more then 1 month to turn the unit and re-lease it, you have exceeded your vacancy budget.

On the podcasts, the term refinance is used frequently but I am not sure how it applies to this situation.

It already has a tenant with a 2-year lease.

Over the last couple of years I've controlled over $2.3M worth of real estate using creative strategies like wholesaling, lease options, and seller finance.

Unless there is something off the books on this deal, my guess is IRR will likewise be unimpressive when compared to money put in a hassle free investment like S&P Index Funds.In regard to your other questions: S&P Funds can and are frequently leveraged via margin accounts. 

I gave them 45 days notice of the new lease and rent increase (5/15).

Is buying a 9yr lease on a bar a wise investment!?!