Seller financing from a 94-year-old -- what could work well?

[Jon Schwartz]

Hi guys and gals,

I'm in an interesting situation. Long story short, a 94-year-old woman has expressed interest in selling me her $2M duplex (in a very nice area of Los Angeles, hence the $2M price tag). She owns the property outright, so I'm trying to think of seller-financing options that benefit her and whomever eventually inherits her estate (she mentioned she has 16 grandchildren and 33 great-grandchildren!).

Also, she lives in the duplex, so keeping her as a tenant for the rest of her life could be part of the agreement.

Any ideas? For starters, I imagined writing a promissory note that was due upon her death to a named beneficiary. That would result in a tax-free payment to her beneficiary, I think, at the time of her death. Is this even possible?

Or perhaps a sale agreement that includes a 30-year lease agreement terminable upon death of either party. If she financed the sale, she'd get a big chunk of change upfront and probably make more on the note each month than the rent she currently collects on the other tenant.

Do these ideas carry any water? Any other ideas?

Thanks so much!