She will likely be exempt from capital gains tax since she lived in the house for 2 of the last 5.I think she may need to be paid in full before that 5 years runs out to get the full exclusion.I'd consult a CPA to know for sure the tax implications. 

He has other medical issues and we’ve had to call 911 on him for falling at least 7 times. 

If the property owner claimed a homestead exemption for their real estate taxes for the year of the foreclosure, then there is only a six month right of redemption, rather than the regular one year right of redemption.

The Homestead of Exemption is $50,000 off your Property Taxes.

We've done buy and builds ourselves or can do BTS's but retail medicine in general has a hard time making the debt on a ground lease work, so if you are looking to do that the medical space is likely not the user for you, but if you were looking to BTS or to sell, its a solid end user to work with.

He went to BYU with the intention of becoming a doctor, but did poorly in chemistry which would be required as a prerequisite for medical school.

(So you don't help to build up the rest of our medical bills through the medical system of course.)

There is often a time limit on how long you are exempt from paying local taxes on foreign income, and of course you will owe the US for life. 

I wonder if the tax forms would be mailed there, and then that trust company will file to IRS to explain it is tax exempt? 

Just because it's a primary residence for him doesn't automatically exempt your portion from capital gains—you're still considered an investor.You also need to think about what happens if your friend can’t buy you out or if your relationship changes.