In that case, send written notice in accordance with your state laws, usually 30 or 60 days from expiration of current lease, explaining that her options are to sign a new lease or vacate at the end of the current term.

@David Key It means residential owner financing is subject to the SAFE Act and the Dodd Frank law which impose significant regulation, expense and risk on owner financing. 

Each county has drastically different landlord/tenant laws.

That's how you make money in pre foreclosure world but the laws changed in our states so you have to be pretty cautious how you do these and it was those changes that led to me abandoned this method of buying property.. but early in the process like mentioned above it was rare to be able to buy those.. remember your not the only one trolling these someone with a notice of default is going to get no less than 200 or so yellow letters and hammered by real estate agents for a listing.Along with the fact that they have probably lived in the house for a year or more for free.. so that motivation Is down the line.. and forget about fixing their credit at this point its trashed.. 

I heard that the tax law no longer allows us to write off the HELOC interest rate. https://www.irs.gov/newsroom/interest-on-home-equi...  

In terms of legality and contract law, doing anything other than stated terms would be breach.That said, you have to decide if you're going to "follow the law".

The seller wants to back out, solve his problem or walk away.....we don’t know what your contract says about default on the seller’s part, or what your state law says.

The closing company/law firm will handle all the paperwork and get your your payout.

I have support from my family(in law) that are interested in starting as well.

My understanding is primary residence are allowed to built ADU (Popularly known as In Laws unit).