Any case where owner financing makes sense?

[Shelley Austin]

Purchased property for 390K, put 15K into rehab. Home now worth 550+. Would like to sell and capture gained equity, also cash flow is not great and the house needs more work. Long-term renters want to buy at 550 as is, but can't qualify for conventional financing. We have a balance of 266K on the mortgage @ 3 percent interest. Mortgage payment is $1671/mo.