#1 is clearly the best choice for stability. But before giving the house to this family, I think you should do the following:
1. Verify his work history, as JY suggested.
2. Verify rental history. If he stayed at his previous address for many years, it's unlikely he had defaulted on rental payments.
3. Check credit history to make sure it's not too bad.
4. Accepting one year's rent is not a good idea. It may be illegal (in some states, the max amount of deposit you can take is 2 month's rent). Ask him to pay last month's rent and a security deposit. If he defaults on rental payment, start the eviction process early.
1. Verify his work history, as JY suggested.
2. Verify rental history. If he stayed at his previous address for many years, it's unlikely he had defaulted on rental payments.
3. Check credit history to make sure it's not too bad.
4. Accepting one year's rent is not a good idea. It may be illegal (in some states, the max amount of deposit you can take is 2 month's rent). Ask him to pay last month's rent and a security deposit. If he defaults on rental payment, start the eviction process early.