I think only in the last 6 months he went from shared title holder/owner to sole owner and only one on title.2) I've heard one can do a contingent purchase on the new home to avoid capital gains, but I'm finding little on this. 

Specifically I wanted to know about the lien holder’s right to walk away from lien and not foreclosure if they choose?

However, I am worried that the holder of my loan will not let me transfer the current mortgage to the LLC without refinancing.

The second lien holder closed doors 2008.

Her being the sole lease holder might very well be tactically useful in the event of any dispute or change in relationship, more so perhaps than following a legalistic template which will have its own challenges given the kids.

Sorry, I should have mentioned this is my third year owning the home and the new mortgage holder has different criteria than my last one in regards to my ongoing escrow account.

The one lease holder is going to start pointing fingers at people who don't even belong in the house and are not on the lease.

Why would anyone buy a lien subordinate to the first lien holder?

Giving the note holder some $$ temporarily is a ban aid to avoid hard money cost as SBA loans are slow.Go to SBA direct to Martin Selander at SBA in Long Beach,    not through a broker.

Since the title company won’t record a second lien at closing without informing the 1st lien holder, the owner financing a second would have to agree to leave his interest unprotected at closing and trust you to follow through with the loan “outside” of closing.