the land bank they are talking about is city owned property they took back for non payment of tax's or liens etc.. its NOT Bank/lending institution you buy the land from the city land bank they may have special programs for locals that are looking for owner occ situations.. either way if you pay cash which is how most of that is sold if not all of it.. then your credit does not matter.

I have two thoughts.  1)  If you can convert your 401K to Self Directed IRA that may be an option to invest INSIDE your retirement account.   60K is much for buying a property but you could can lend it out to get 10%+ returns.  2)  Have you looked into a HELOC 2nd loan on you house? 

Start seeing homes and buy in a few months.The sooner you buy, the sooner you start the clock on lending to allow you to buy again.

If you have someone or know someone who is actively lending.

From there I would speak with a lender in/around Knoxville to see what lending options there may be for a new development.

I'm new to BP and trying to build a team as I dive into more frequent and long-term profitable REI.I've been doing SFH rentals over the last 15-18 years, but it's all been very traditionally financed (ho hum, 30 yr fixed) and as such has limited my ability to invest more frequently, and grow a portfolio.I'm here to learn how to use more creative financing strategies (private money lending, Sub-to, seller financing) to acquire 2-3 units (duplexes, tri) and 5+ multifamily properties. 

Typical lenders require at least 20% equity in the property before they lend.

We have a supply issue because banks stopped lending to builders other than one or two at a time for spec builds after the bust in 08 so they were limited in being able to grow the supply. 

Both you and your family members should meet with a lending attorney who understands lending law in your state.  

As for lending options definitely check in with @Joseph Chiofalo we've worked closely for 20+ years and he is an FHA mortgage savant.