Is there a type of mortgage insurance or bond you can get for owner financing that secures his position? 

I’m Chris Dickerson, a newly licensed Mortgage Broker based in PA, specializing in financing solutions tailored for real estate investors.

Not only that he gets stepped up basis and sell with no tax  double check that with accountant but I think that is correct.. then take the cash put it in 5% gov bonds for now then get up to speed and see what you really want to do. 

You found a PM who's specialized to this exact market and property type.

Some lenders specialize in asset-based lending, considering rental income on Schedule E, especially if you have strong rental history.

If you do not like bookkeeping/accounting/technology, hire a bookkeeper specializing in real estate investors.

DSCR guidelines vary by lender and working with a mortgage broker or lender that specializes in these mortgages can help get better terms such as a DSCR 1 ratio vs a DSCR 1.2 ratio.

Expertise and Experience: Property managers have specialized knowledge in managing properties, including understanding local market trends, legal requirements, and tenant relations.

Highly recommend getting in touch with a good landlord/tenant lawyer that specializes specifically in CA. 

Many jurisdictions will not record a subdivision plat until you've put in (or bonded) the infrastructure (power, sewer, water, roads, etc).