How can he refinance into a traditional 30 year mortgage? 

But can he still get his grubby paws on the LLC?

Or can he not evict them as part of the trust and is looking to work around his limits to get them out?

If @Eric Fiedler  buys 7/8 of the interest in the property can he then bid on the property at auction with 7/8 of the proceeds going back to him and 1/8 to the PITA?

I actually have a CA C Corp that I can use as a management entity. 

It is likely advisable to have a written agreement that addresses all sorts of possible issues that could arise in this situation including with regard to the loan and any mortgage interest deductions, splitting of expenses, splitting of profits, tax reporting, what is to happen in the event of disagreement, any rules about rehabbing such as particular types of materials to be used or types of projects (can he choose the cheapest and ugliest materials, consider that has having rehabbed it, and then takes a split of the profits still at 50%?)

I told her that's between them, and she is responsible for rent payments and damage as long as she is on the lease.Recently she sent this:"Can he legally change the locks on the house without giving me a key?"  

I am no legal expert but how can he sue you if you re not the actual owner?

He has a real estate LLC, can he lending out using his real estate LLC as an lender?  

But how can he possibly stay in business?!