A Land Contract Question

[Micah List]

We recently submitted an offer for a house in Ypsilanti, MI. The offer was for full asking price on a land contract amortized over 30 years and with a 3 year balloon. We offered 10k down. After some research we were under the assumption that the owner owned the property "free and clear".  Just heard back from the seller and while they seriously considered the offer and thought it was "extremely fair and thought out", in reality they do still owe $39k on the property. I am not one to give up and knowing that they seriously considered the offer, I am inclined to try to make a way. I am vaguely aware of the concepts of mortgage assumption (while I don't know how to go about it) and a "subject to" deal. Can anyone elaborate on these for me (specifically in the state of Michigan) or offer another creative way to make this happen. Just to take it off the table, paying 50K up front (down payment + remainder of mortgage) is not an option for us.  Any help or thoughts would be greatly appreciated!