Tenant wants to purchase with Hard money

[John West]

I lease optioned a property to my tenant. The option is expired, but tenant still wants to buy. Agreed purchase price was $100k, but tenant can’t get approved for that much. Tenant has secured a hard money loan for $75k. He is willing to pay off the remaining 25k but obviously whoever is giving him that $75k is going to want title. He agreed to pay, but I don’t know how to structure that. Even if there was another note on the property, I don’t think that would end well. If he gets foreclosed on, I probably would never see a penny of the $25k.... I had a real estate agent walk through the house and want to list it at 125k. Realistically I’m guessing it will only go for 110-115, which after commissions won’t be much more than the 75k + 25k. I’d rather sell to the tenant cause I’m a little worried of what he/she might do to the property if I evict. Maybe that’s an irrational fear. Maybe the first scenario is crazy. Any advice?

[Tom S.]

@John West  I personally would just list it with the realtor, and you're right if it goes for $110k, in the end you'll net about $100k.  But that seems much less risky than the $75k + $25k scenario you just outlined.