My "Fixer Upper" needs too much work for bank to Mortgage. HELP!

[Corey Johnson]

I have a house in major disrepair that I want to Fix-Up.

Asking price is $80K and I'm looking to get it for around $60K.

Its was built in 1895 and has city water and a septic system.

The heat was supplied by Gas stoves/heaters, but is run off a Propane tank which the owners have removed.

The structure seems good to me, but the Mortgager lender I talked with said it would have to appraise and there cannot be any structural damage or safety concerns.  And the appraisal coming back "subject to repairs" would not allow the loan to close until the repairs were completed.  The house has been vacant for 5 years. The owner is likely not going to spend money on repairs and installing a propane tank and heaters (a permanent heat source is required) so that I can get a mortgage.

Also, the lender wants the sale price to be at least $70K so that after my 20% down payment, the loan is big enough.

I'm not planning on renovating and selling quickly.  I will do reno myself over time (I'm a contractor), and move in when done. And then turn my current home (which I own) into a rental property.

Does anyone know of a kind of lender that deals with these types of properties. Or is there a special kind of mortgage product that is designed for houses without heat sources.

 The loan would only be for $40K - $60K.