Overlays are extra rules banks put on top of Fannie/Freddie rules to be more...selective...that might be a nice word for it. 

That would be an extra 135 a month. 

Most of these deals end up with at least one and usually both parties unsatisfied.

Usually, if a house is sitting longer on the market then its neighbors its either priced too high or does not have enough exposure.

Just be careful because usually subject to deals don't obligate the buyer to keep paying the mortgage.

The answer to all problems, are usually right in the problem...hidden in plain sight.

The general idea is the bank will loan you extra money to cover the cost of repairs,  this is typically only done with commercial loans and they usually escrow the money and release it to you as you complete the repairsBy way of example say you buy a 500K house that need 100K in repairs. 

@Mike Reynolds  Hey Mike, we meet on the 3rd Monday evening and usually meet at Golden Corral but we are looking around and trying Cotton Patch out this next Monday 19th.  

If there is an inspection done on the property the investor/buyer usually would pay for it. 

The little bit of extra cost will definitely pay off if you end up having a claim that would have not been covered otherwise.