I will take your word and assume this is a legit sale.

They are only willing to finance a small amount as they say the money down they need to cover the taxes owed from recapturing all the depriciation over the years.What are the rules on recapturing depriciation when a seller wants to owner finance the sale? 

You could make the sale contingent on the two POHs having a title.

. $275,000 with an end sale of $390-420,000 doesn't sound like a break even to me.

Has a taker, rakes in the option fee, the extra rent, and IF the house sells, the difference is sales price.

The obvious answer is flipping.Basically they buy a property needing a lot of work, they put a lot of money into it, then they list it for sale.

One bank I have offers 2% car loans.

The house was also facing sheriff's sale and we had to file some court documents and get it postponed.  

I am on List Source trying to gather my numbers for certain zipcodes in my farm area such as how many SFH, Equity, OO, REO etc and I can not seem to find how to check for " total cash sales in the last 6 months to a year". 

I visit my out-of-state properties twice a year and it's more than $2.5K when you look at plane tickets, hotel stays, car rental, etc. not to mention there is added risk when you can't drive by your property from time-to-time.