., the court found that in determining unconscionability, the trial judge may consider: 1) the amount of the proposed rent increase; 2) the landlord’s expenses and profitability; 3) how the existing and proposed rent compare to rents charged at similar rental properties in the geographic area; 4) the relative bargaining position of the parties; and 5) based on the judge’s general knowledge, whether the rent increase would shock the conscience of a reasonable person.In my opinion if you're basing the increase on market conditions and not on trying to take advantage of anyone or increase the rent as a way to eliminate a tenant you'll probably be fine.

The other part is that the current manager is literally just collecting a pay check and is never onsite.

No appreciation, no upside, etc. and then if the property stands on it's own in current condition throwing off cash then you might have something.

USAA does have an agreement with a third party company, but they were much more expensive for much less coverage.

I would offer that you place a third party manager that is acceptable to the seller in lieu of a bond.

And I have touched base with other PM's in my target market area just in case, you know, as part of due diligence....I stand by my original post with the clarifications noted above. 

Getting cash flow is fun but always remember about protecting yourself from the legal stand point.

Your question is pretty simple yes it would be a leasehold estate and you have no standing in refinancing the property until you exercise your option  and actually purchase the property Then you would be able to use the new rent rolls on the purchase 

Homeowner Association Information Request2.what statements define the terms of an agreement and give the other party cause to void an offer if the terms are not met?

Now you negotiate to come to a point that both parties are happy.