@Eric Trompeter I am working on setting up a similar arrangement right now.

Although the insurance company, contractor, you, and the bank can make whatever arrangements you all agree to even before work begins. 

After the last deal & the first partnership, I realized I can put together these syndications more often if only I met more people who would qualify for this type of arrangement. 

I emailed the landlord warmly asking her if she had considered selling the house, and if so, could we work on an arrangement to purchase the home at the end of our lease.

Either they agree to a household cleaning arrangement or it's a trainwreck.  

Download your state landlord tenant laws, you could arrange a mutual lease termination buy out and charge a fee equal to several months rent to let him out, depends on state statues if there is a limitation to what that fee can be.Happens all the time so that's the nature of the business.

Of course there is always a certain degree of risk with any arrangement, whether tenant pays each month or 12 months in advance.

Originally posted by @Momchil Kanev:She will need to pay the tax on her 50%I am wondering if it would be possible to arrange the ownership 90/10 (Tenants in Common) or something, to avoid some of the tax?

Is your current arrangement perfect?

You're subsidizing their living arrangements and even after 10 years they can't qualify for a mortgage?