What's the Best Way to Structure this Purchase - Seller Wants to Stay in House for 6 Months?

[Dawn Vought]

I would like to hear any suggestions or thoughts on how to best protect myself in this situation. I have a motivated seller who wants to sell his house quickly to an investor for cash to get the deed out of his name. First he said he was liquidating everything to go back to his country overseas. Now he's telling me that he just wants a clean slate to start over. The house was previously his and his ex-wife's. He got the deed transferred over to just his name a few years ago. (I have a copy of the recorded deed.)

He didn't say this but he may have some sort of legal things pending that would attach to any property he has in his name, so he'd rather cash out and rent somewhere for a while until he gets it worked out. I made it very clear that full title work will be done, and the house will need to convey with clear title so we can get title insurance, so I will find out if anything is currently attached to the house.

He's telling me there are no mortgages or liens on the property currently, so he owns the property outright. The problem is he has 3 kids in school and does not want to uproot them and move until they are done with school in June. He also indicated he would need the time to find someplace else for him and his kids.

Here are the numbers on the deal:
-I would purchase for $300K.
-House is in a very nice area with a wide range of recent comps - $390K to $577K.
-House needs little to no work and was beautifully upgraded (according to the seller - I have an appointment this Friday to see for myself).
-Real estate taxes are a little over $12K per year.

I was thinking of maybe closing on the property by putting a very small amount down (maybe $500 or so?) and setting it up so that the current seller held a note on me with a balloon payment due in six months after he actually vacated the property and handed over the keys. In the meantime I would market the house out to either a retail end buyer and/or investors who want to make the house a total diamond and get the higher end of the comps selling in the area. I would close the balloon payment with transactional funding that I have available to me.

It seems I would wind up paying for about 6 months of taxes ($6K), but would be worth it in the spread.

Any ideas how to best structure this deal?