Use the remaining cash to purchase a passive investment 1031 compatible vehicle like a TIC or NNN lease and pay tax on the mortgage buy down. 

His property management company is advising against eviction proceeding because it would take 10 years to collect repayment and they would have to leave the unit vacant for the remainder of the lease.

@Steve G. for lease option to buy contracts??

TO get applicants in ,, we would say Free applications,, with signed lease.. so if they qualified, we'd credit the cost of application back to thier account,, they all still had to pay the application fee,, we just absorbed the cost if they signed a lease...

We are renting a home with a lease option. 

So, if I refinance at $350,000 (which is at the bottom of what I think it is worth, at 4.5% interest rate at a 70/30 LTV, $6,000 in taxes, and $2,500 in insurance, the mortgage payment is $1,950/mo and the property currently leases out at $3,550/mo. 

Even if there is no lease, if it's been 30 days or more, then this is a concern.

I currently live in a house that I have a lease purchase agreement on.

The housing department has not paid me their portion of the rent since October due to the fact that I have not signed the HAP contract which looks and reads a lot like a lease to me.

I have an opportunity with a seller who is willing to do a lease to own contract for me to purchase a home he bought and is now ready to flip.