Can equity be transferred for cash without finalizing a sale?

[Karlos Rueckert]

I have a motivated seller that would like to sell but cannot due to some restrictions in his area. If he were to sell any time in the next 15 years, the new buyer would need to meet a long list of low-income requirements.  Four or five potential sales have fallen through due to these restrictions.  This also significantly reduces the asking price. The low-income requirements tied to this property fall off in 15 years.

He would like to cash out his equity rights. In other words, if the place is worth $200k and his mortgage balance is $100k he is willing to give up 100% of the equity rights for $100k. The mortgage would continue under his name however the new investor (presumably me) will be responsible for it.

What are my options as the investor to get this deal done? How does the deal need to be structured in order to ensure that the investor has 100% equity share?

Some ideas that I’ve been kicking around are; loan the funds as a second mortgage, subject to, set up an option to buy. I have very little experience with any of these strategies so any help would be appreciated.  Thanks.

Also, the unit is rented (Not owner occupied) and is cash-flow positive.