On the owner side of a lease option, I think I'm selling a call for 2.8%

You've priced the option correctly and then talked yourself out of noticing it. $8,000 on a $285k house is 2.8% for a 36 month call at a $310k strike. Nobody would sell that on a listed market.

The part I'd push on is the 36 months. Three years is a long time to hold a price fixed in a house you'd otherwise be free to sell, refinance, or 1031 out of. If she needs time to season self-employment income, 24 months usually covers it. Ask her lender contact what they actually need, in writing, and set the term to that instead of to a round number somebody picked.

Your math is the right frame. Restating it: you are writing a 36 month call at $310,000, collecting $8,000 today plus $250 a month that reduces your net at exercise, so your net proceeds if she buys are about $293,000 in year three.

The whole decision sits on one assumption, the probability she exercises. Run both branches.

If she exercises: $293,000 net, no listing commission, no vacancy, no turn. Against $285k today less roughly 6 to 8% of transaction costs on an open-market sale, call it $264k net now, that comparison looks much better than 2.8% suggests. You are not comparing $293k to $285k. You are comparing it to what you'd actually clear selling.

If she doesn't exercise: you keep the $8,000, the $9,000 of credits never leave your pocket, and you hold a house that has had three years of a tenant who may have deferred anything she thought you'd fix later. Price that. The repair split you described puts the expensive systems on you while she has no equity yet, which is the standard failure mode.

Two mechanical points. Keep the option to purchase as a separate contract from the lease, which is what practitioners consistently stress, because blending them invites an argument later about what the arrangement actually was. And how heavy rent credits get characterized for tax purposes, including whether an arrangement looks like an installment sale, depends on the facts and on your state, so put that in front of a CPA and a real estate attorney before you sign rather than after.

The number I'd want before deciding: what does her lender say she needs, and by when.

In the rural markets I look at, the tenant-buyer pool is mostly people who will never qualify, and the option fee is the only money you ever see. I've watched three of these locally and none closed. Doesn't mean yours won't, she sounds a lot more real than average, but I'd size the fee as if it's the whole trade and treat the sale as a bonus.

The repair split is where I'd spend my energy, not the strike. "Under $500 on her" sounds tidy until the water heater is $1,400 and the roof is $11,000 and she's living in a house she thinks is already hers. I had a tenant on a straight lease start replacing light fixtures without asking, and that was with no option agreement giving her a reason to feel like an owner.

Write a condition report with photos at signing, put a dollar threshold and a written-approval requirement on any alteration, and say plainly who pays for the systems. Hollow is right that the fee may be all you get, and if that's the case you want the house back in the shape you handed it over.

One thing nobody's said. Whether you can record a memorandum of the option, and what it does to title if you do, varies by state, and it varies by county recorder in some places too. She'll probably want something recorded so you can't sell out from under her. That cuts against your flexibility for the full term, which is the real cost of the 36 months orchard flagged. Ask a local attorney what the practice is where the property sits before you agree to the term length.

Question rather than an answer: what happens at month 30 if she still can't qualify? Is there a mechanism to extend for another fee, and do the accumulated credits survive the extension or reset? Every one of these I've read about seems to die at that exact moment, and the contract usually has nothing to say about it. If you build the extension in now, at a price, you've turned your worst branch into a second payday instead of a fight.