He would like to sell the property while minimizing his tax liability, which ideally would be an additional land contract to our company. 

As far as getting approved for the loan it shouldn't be an issue as long as your DTI is good.

I'm reading between the lines of your original post and for some reason I think there may be an emotional pull to this property.

However, with photo deposit of checks that method could soon be an option again. 

Maybe have a convo over coffee about how you analyze and that they are double working if you both are doing the same thing but getting opposite results. 

A potential option could be an electric Murphy bed that rolls up behind cabinetry.

If they hear the word investment or rental, they will be pushing for things to be an investment loan to compensate.

Also if you're planning on keeping it a sewer scope inspection would be an intelligent thing to do.That will give you an idea of what you have , and some intelligent discussion material to talk to contractors about regarding finishing it up to a closed state and repairing it . new windows new doors new wallboard fix ceiling etc ...

As others have mentioned, a 5% conventional might be an option, but with that loan amount there might be limits too.

The balance won’t be an overpayment.