[jyl]

Sounds like you might want to rent to someone without a dog.

Are they willing to pay what the option is actually worth? I don't know what dollar figure you come up with, either using my methodology or another, but it should be significant. Can/will they pay a very large premium over the market rent of the house?

You know, I don't really understand why they want to do a rent-to-own. How long will it take to rebuild their credit enough to finance a house? X years? If it is that long, are they going to pay the fair price of a X-year option? Option value goes up with longer time periods, is X is several years, that would be a very significant sum indeed, and if the value of the house goes down, or they have to move, or they can't pay the rent and get evicted, or for whatever reason they don't or can't buy the house for the agreed price, they get nothing. Talk about speculating on real estate. Does a rent-to-own actually build anyone's credit - I don't see how.

I'm sure there is a way to structure the deal to make it work for you. Not sure it wil work any better than simply renting the house and selling it in X years.