This reduces the rate of interest by 2% the first twelve payments and 1% payments 13 through 24.

Their capital exposure was reduced by 200%+.So now they own the house and work is being done. 

@Dan Stelmach You can reduce your capital gains by writing off expenses like the $25K in improvements, closing costs, legal fees, and real estate commissions.

This gives him a chunk of money upfront to do with as he sees fit, ensures he gets steady income (with interest), and reduces his tax burden.

You ask them their challenge and there is typically an option that reduces the challenge.  

(Approximately 13 states have either state Inheritance Tax or state Estate Tax, so that would possibly apply in other states besides PA.)Welfare LiensNursing home liensMechanics LiensMortgages in order of recording date, first mortgages before second or third mortgagesJudgements (once boought a property where there was alien because the owner got in a bar fight and was sucessfully sued for medical bills esulting in a judgemen.)Federal Tax Liens (Special rrules apply to IRS liens)The precedence of pay off is determined by state law, government first, then the rest by date recorded.Then is anything else is left over it goes to the former owner.On one of our purchases there was a big Nursing Home lien that the Tax Claim Bureau was not aware of. 

One example that stands out in my memory: I had found a property for sale off market and asked my agent if she would handle the transaction for a greatly reduced fee since I had found the property and already negotiated the price.

You'll have to pay beyond interest due to reduce the principal.  

Maybe I have considered it but I will probably be able to get reduced commission from the agent I work with.

We typically lend to 80% LTV (loan to value), but if our DSCR is less than 100% (1.00 DSCR) coverage we reduce our LTV to 75%.