A refinance that only pays off the existing balance (plus any costs) is considered a rate and term refinance and should offer lower mortgage rates and costs due to simplicity.

Debt InformationWhat is the principal balance of the loan?

My partner and I use the subject to language from the AIR CRE forms as an addendum to the REPC - UtahSubject to language for purchase offer - Utah REPCBuyer(s) shall take title to the Property subject to the following existing deed(s) of trust securing the existing promissory note(s):(i) An Existing Note (“First Note”) with an unpaid balance as of the Closing of approximately:Said First Note is payable at $_____________ per month,Including interest at the rate of _________ per annum until paid (and/or the entire unpaid balance is due on ___________ (date).

This seems unnecessary currently.I am looking for more security but with a good balance of ease of use.

Balancing these factors is crucial in making your decision.

The idea behind what I trying to coin 'Total Return Investing" is that how you balance the different forms of returns is up to you! 

With this setup, the buyer would still make the same monthly payments, but instead of stretching those payments over 30 years, they would need to pay off the remaining balance at the end of 5 years.

I have very little equity in it and my loan balance is around $400k. 

TLDR: If you're in year 4 of 10 and pay the mortgage off, your payoff balance will be adjusted to reflect the cost of buying a gov't bond that will produce the equivalent amount of dividend payments for the remaining 6 years (in other words, one way or another, the lender is absolutely going to get their 10 years of payments).

Counsel with the seller after you obtain all the information about his situation (balance, how far in arrears, why he got into this situation, and all financial information).