If you deed the property to the buyer and take a lien position then you would have to foreclose on the buyer in the case of default. 

But I just defaulted to the tenant until I could figure out the issue.This tenant is also a problem tenant.

will his loan default to me since we do the deal together or my mother by marriage? 

In a pre foreclosure, meaning the lender has filed a notice of default and possibly a notice of sale, and if the property lacks equity, then the bank will have to agree to a short sale. 

If the buyer makes the payments on time your credit will not be affected, however, since you are still the owner of the mortgage any late payments or defaults will be tied to your credit score.Rent options, subject to and owner finance are all non-traditional financing types and as such you will need to have the contract written by an attorney. 

However, keep in mind that you will need to be able to cover the loan payments on the heloc and it is your personal residence at risk if you default rather than your investment property. 

We have a lease just like any other rental, although we've never really had anyone default on a payment yet so i unfortunately can't offer any wisdom on that front. 

I'm not a tax expert but I understand 30% is the default withholding tax rate.

If they don't pay the 1st and miss the 2nd, send notice of default and intent to accelerate (i.e., start foreclosure). 

Or, as you said have someone get in there and fix the house so you build up the market value should he decide to default, you indeed be rolling.