The balance of the purchase was financed on a 3 year land contract (I believe at 9% interest) with a balloon.

Otherwise, the balance due will just continue to grow.Otherwise, consider a Cash-for-Keys surrender to get possession back with minimal losses (ie balance still outstanding).

The outstanding balance was $116,900, however the open bid was $124,167.  

So given the schedule below, the seller would receive $14,669 in interest (2016 $3732 + 2017 $4910 + 2018 $4832 + 2019 $1195) and the total amount of $4,242 (2016 $1100 + 2017 $1532 + 2018 $1610 + 2019 $415).So after 3 years the total amount left on the terms would be the initial $100,000 – $4,242 (the principle paid) leaving a balance of $95,758.As I understand it (please correct me if I am wrong), before the 3 year balloon, I would need to either secure a conventional and/or private loan for the remaining balance.

This works when you want to give the seller options balancing between price and terms.

Most HM is interest only repayment, so the balance will not go down.

I know you wanted to save money on the listing but here are the main reasons to have a vehicle for checks and balance.

Here is how you tell if a seller is motivated:You have a question form you ask every seller (bedrooms, baths, mortgage balance, etc.) and if they won't answer the questions then they are not motivated.

Say now the balance is $85 and you purchase for $65k with the property quit claimed to you and the borrower/buyer now continuing to make payments to you.

It is in MD, paid $230 comps at 305k loan balance at 197k