@Matt LawtonThe fundamental issue here is that this doesn't allow for a proper inspection of the property.

Will follow up with a proper custodian.

You definitely want to do your due diligence to make sure your contract is legal and executed properly, but there is nothing inherently wrong with that purchase method.

Then if they were no longer able to pay their bills and close down they could be berated by someone like you for not being properly prepared for the situation.  

I've seen a lot in my profession who work too long and too hard because they never invested properly. 

The key is to be properly capitalized for both the PM and investor.

Example, if my payment to the owner is $1500 a month and their payment is $1250, I pay $1250 to the lender (make sure you put the account number in the memo or it is ACHed properly) and the other $250 goes to the owner. 

I hate to sound like a broken record, but this all goes back to proper screening.Even if they could not pay full rent, a properly vetted tenant would not look for this out and communicate with the landlord.

In that case, a majority of landlords are going to react and respond with compassion and appropriately, making the right business and ethical decisions.

How do I share photos properly?