Duplex contract for deed deal structure

[Lee Fahy]

I have a duplex in south Minneapolis with an owner that's in a bind, she's elderly and not able to care for the property in the manner she would like.

- She has no money 

- main unit was trashed (not sure how bad) so she can't rent it

- Social security is $700 a month

- doesn't want to move 

- heading to foreclosure

I spoke to her about possibly buying the place and figuring a way where she would not have to move and I would care for the property. I have a contract for deed on another property so this isn't my first rodeo but I'm not sure how to structure this. My thought was:

- Buy the duplex on a contract for deed (10% down) and the monthly payment is discounted from her rent? Example: rent is $1000 a month and the contract for deed payment is $950 a month, her monthly rent due would be $50 a month. 

Any thoughts or recommendations would be greatly appreciated. 

[Scott Jensen]

@Lee Fahy What is the plan for avoiding foreclosure? Do you have any information on the remaining amount of the current mortgage and how much she is behind?  That will need to be caught up (or paid off) to get the deal to work and ten percent down may not be enough.  

I would treat the rent and contract for deed payment separately. Combining the two may be more complicated from a tax standpoint.  (ie: charging her below market rent, and properly filling our her CRP).