Or like California a RE Broker like myself or Consumer finance license all which are regulated by the state .

One possibility is building a duplex in Peoria, while it's not the best rental market, getting a duplex at a possibly much cheaper price than market value is extremely appealing.

You may also want to look into 2-4 units as those are the easiest to finance and help you grow faster.

Experienced developers, could you tell me how the process/financing works?

Let's just say even seasoned syndicators are having a lot of trouble raising capital these days.Personally, I would focus on growing as a pilot and getting into mainline (if you aren't already there) and into the captain chair as quickly as possible. 

Back when I was in finance, we had a broker who was charging a family 2% for management fees on their cash that was only making 0.3% at the time.

It is going to be near impossible to cash flow on a property with 100% financing, especially if that partners rates are above conventional rates.

How did you finance this deal?

Here is some key information:Property recently hit the market and has 2 cash offers alreadyThe seller provided a pre-inspection report, which I shared with 2 different lenders, both think it may fail conventional financing due to potential structural and electrical issues (realtor thinks it could pass conventional)Seller has 100% equity but is behind on other payments (not sure of the urgency money is needed)This is my first attempt at an “investment” property so I’m new to thisI see 3 optionsMove forward with an offer using conventional loan pre-qualification-Not as attractive of an offer to the seller-Possibility that appraiser calls out structural/electrical issues that need to be fixed before closing, effectively causing financing to fail- Best terms and fewest loan fees for meUse a rehab style loan such as ChoiceRenovation-Even less attractive than a conventional offer to seller, but less risk of failed financing if appraiser calls out issues-Slightly worse fees and interest rates compared to conventional-Lenders tell me possibly up to 60-90 days closing in some cases, with red-tape for contractor requirements and draw schedules (sounds like the most hoops to jump through during rehab)Use a hard money lender-Most attractive loan option I can give to seller so I can compete-Much higher fees and interest rate for me-need to refinance into a conventional at the end of rehab (not familiar with seasoning periods but I think this is a factor as well)Which option would you do?

Maybe sit down with her and look at the finances for her and if it makes sense for her to buy the X out and refinance if that is even possible.