Can I purchase a home in Michigan on a land contract if the current owner has a mortgage on the home?

Yes. I would, however, have language put into the contract that requires the seller to keep the mortgage up to date.

You really need a lawyer for that one. I wouldn't do it. Can you assume his mortgage? If he defaults, the mortgage company (who technically owns the property) will take it from you in a second. They don't care what agreement you had with the owner.

Think about it - I can't sell my brand new car to you while I owe $$ on it, because I don't technically own it yet. You can pay me for it but I can't give you title until the lien clears.

This sounds very fishy.