Me thinks at this stage of the game that there are some global rational minds that will rise up and declare a kind of global blanket bankruptcy of sorts, wipe the slate clean and start this whole global economic thing from scratch with an internationally accepted currency based on some form of real collateral be it GOLD or KRIPTONITE from an alien source. 

Yes, I filed bankruptcy when I was 22.

They can be simple or complex.Creditors have a hard time dealing with a debtor in a TIC as a minority holder, they can't put other owners in a position to lose money, equity or future income, they can tag the income from the amount due the minority owner as it is received.Bankruptcy of a fractional owner generally has little effect on the one taking bankruptcy and won't as to other owners. 

If you buy with occupancy to foreclose the borrower could file bankruptcy.

Wouldn't/couldn't take a 50% forbearance deal. 2 prior bankruptcies. filed CFPB complaint, claimed unlawful court action.

I heard that they both had to file bankruptcy.

@Mark K.PPR does have a "backstop" in the case of bankruptcy.  

Another point is that, as you mentioned, I want them off the note too, what happens if the die, become incapacitated, take bankruptcy, have tax problems or other creditors come after them.

Bankruptcy might be an option. 

It became clear there was zero chance he would ever recoup his losses, and bankruptcy/foreclosure was inevitable.I felt that offering him an investment opportunity that would give him a chance to recoup some of his losses was the right thing to do.