I own a house in Redding, CA that has a mortgage on it of $756,000 with OCWEN. I have someone interested in purchasing it and will give me $250,000 toward $1,000,000 purchase price. HOWEVER; they cannot obtain financing (it's a non profit and they don't have ability right now to finance) They want me to keep in my name and they will make payments for the next year, and do all maintenance, etc. At the end of the year they will refinance. 

How can I do this? Are Contracts of Sale illegal? Could I do some type of partnership, lease, or ? I want to make sure we are both protected. Should something happen to me, I want to make sure they are covered and can complete purchase. However; if they can't make payments, or refinance, I want to be able to make sure I don't have a big problem too. On te $250,000 would they be entitled to any of it back should they not be able to refi ?  Since I'm not actually carrying a note, I would not have foreclosure as recourse, so how do I address it? 

I will also seek advice of an attorney, but like to get your well informed thoughts so that I make sure I cover all the bases. 

Any suggestions? 

@Jay Hinrichs I know you are experienced at finding creative solutions, any ideas? 

all inclusive Deed of trust  ( IE wrap would be the most protection for the buyer and you) only risk is ocwen calls loan on the alienation but they are so goofed up these days I don't see that happening in a year.. but that would affect your credit.

other wise lease option to purchase  250k is the lease option payment to you.. you don't give them title if they cant purchase then you have the house.

the wrap puts them into title and will allow a refi with one year seasoning that is why that works so well.

must be a great place at 1 mil in redding  !!!!

@Jay Hinrichs It's the location and size of the house. It's 4600 sq. ft. plus 1200 sq. ft. on ADU. 20 Acres, seasonal pond. Eventually they will zone it multi family, but not for awhile! For now it's great for groups that go to Bethel, or for a VR for families, etc. For me, it's just too much to deal with being on my own, pool, acreage, maintenance on big house, etc. Also, aside from the house and ADU, one more home can be built on property.

Wrap around mortgage with a company setup to make sure monthly payments are made.

Steve Peterson of Infinity Investments has done this kind of deal in the past.  He may be able to help you if you look him up and contact him.

Originally posted by @Karen Margrave :

I own a house in Redding, CA that has a mortgage on it of $756,000 with OCWEN. I have someone interested in purchasing it and will give me $250,000 toward $1,000,000 purchase price. HOWEVER; they cannot obtain financing (it's a non profit and they don't have ability right now to finance) They want me to keep in my name and they will make payments for the next year, and do all maintenance, etc. At the end of the year they will refinance. 

How can I do this? Are Contracts of Sale illegal? Could I do some type of partnership, lease, or ? I want to make sure we are both protected. Should something happen to me, I want to make sure they are covered and can complete purchase. However; if they can't make payments, or refinance, I want to be able to make sure I don't have a big problem too. On te $250,000 would they be entitled to any of it back should they not be able to refi ?  Since I'm not actually carrying a note, I would not have foreclosure as recourse, so how do I address it? 

I will also seek advice of an attorney, but like to get your well informed thoughts so that I make sure I cover all the bases. 

Any suggestions? 

@Jay Hinrichs I know you are experienced at finding creative solutions, any ideas? 

 I'm not sure if you have the ability to pay off the lender.  If so you can do that and then keep the 250K as a down payment and write a mortgage so that you can act as the bank.  Collect monthly interest on the 750K monthly until they pay it off.

If they really have 250k to put down. Then they need to talk to more mortgage companies. They could probably buy it with 3% down and have enough money left to make payments for 4 years. Something doesn’t add up. Sounds a lot like a Nigerian Prince email I received.

Update:  We didn't do this deal. It was actually someone that I had leased the property to before, and they have a non profit. I thought they were going to buy as the non profit, but it turned out it was the director and his wife, and I was unsure of the stability of their income, so I let it go. 

I currently have the house on the market. It's a big house on 20 acres, right down the street from a ministry school that  is doing a $96 million dollar expansion on their school, and has no dorm space.