Investing advice on single family home

[Shane Goodlett]

I have an opportunity to invest in a home for use as a home based rehab business. It’s set up perfect for them. Has 3 bathrooms with 1 being handicap accessible and 4 beds with option to convert a 5th room into bedroom. I would just be the Landlord they would rent it from me. Zoning has already been checked out.

Deal

315,000

20% down

6.75 rate with my credit union if I do a 5yr balloon 25yr amortization.

With taxes and Insurance and maintenance set aside I can cash flow $800 a month at lease terms of 1% of purchase price. They want the option to buy once business grows. 

1. Would you do this deal?

2. What language would you include in lease for option to buy? I.e. would you make sure they buy at a price point that has a minimum amount over original purchase price?