Creative way to acquire a burned SFR

[Thomas Byrd]

Hi Everyone,

While out driving (actually walking) for dollars this weekend, I found a 1400 sq ft., 3 bd, 2 ba, SFR, on a decent sized lot, right down the street from one of my other properties that I feel would make an excellent "BRRRR" property. According to the neighbors, the owner moved out of the house six years ago after the kitchen caught fire. After gaining access to the property (with permission), I found that the overall fire damage to the property was actually not that bad. My question is not should I acquire the property, but, rather HOW can I acquire the property?

 The owner still owes money on the house (assume-ability has yet to be determined).  The amount due is roughly equal to what I feel the property is worth in its current state.  But, of course, a bank won't loan on the property because it isn't livable...  What I would like to do is figure out a way to do some sort of seller financing (WRAP or perhaps a lease with ROFR), use my cash reserves to fund the rehab, then refi at the 12 month mark to get most of my cash back out + pay off the seller's existing mortgage.  Does this even sound feasible?  Has anyone ever gone down this route?  I'd love to hear some stories and advice.

For what it's worth, the property is located in California...

Thank you for reading!

--Thomas