I'm planning to liquidate about $1,000,000 of mid-west farmland (no debt; cap rate of 2.6%) and invest in multi-family.

This may be a long post, but I thought it would be good to walk through everything step-by-step, and explain my thinking along the way.If you want to stick with me through it all, here we go:I was not going to be getting a conventional mortgage for my first property for a number of reasons.First, I am still annoyed at the hoops I had to jump through to get a mortgage for my primary residence.Second, my liquid cash was on the lower end.Third, the properties that I would need to start out with would not be financeable anyway.Fourth, my DTI is on the high side, due to the decision that we made to take out a HELOC to complete interior improvements on my primary house.So, I decided that my path was going to be to form a single member LLC, and take a loan from my 401(k) at work to finance the down payment.Since I do not view the 401(k) loan as a long-term solution, I am treating like hard money, and pay it off ASAP.So, my first deal would be a flip, or a rental that was such a good deal, that I could re-fi out and pull all my cash out.I decided to reach out to the commercial lending department of the local credit union, which I am a member.The person I talked to (who became my lender) is fantastic.I told him what types of properties I was looking for, and that I’d look to turn them into rentals, or to flip them.I will never forget his response, which reminded me why I love this credit union.He said:“Typically, the deals you are talking about are much smaller than the deals we like to do.However, we also realize that you can not get to that level unless someone helps you get there.So, if the numbers make sense, we will see if any of our products fit.”Awesome!

If buying from an individual rather then a bank you could always propose some cash and some loan to keep you liquid for other deals or repairs.

We called for the property management company to come spray the property over summer since it was infested with bugs really bad.

Don't go to the black-brown though because it shows every speck of dust and if someone's had it before,  they won't want it again.Depending on the amount of time you have, maybe you could look into a liquidation place or auction for flooring too because you'll need so much.

Is it still a complete and functional home if there's spray paint on the walls, a hole in the drywall upstairs, only one functional bathroom, and a cracked window in one of the bedrooms?

His kids are liquidating his properties. 

You have to have the financials to qualify for one.....probably the ability to show your liquid assets of twice the amount you're looking for.

The smell of cat urine, and more-so, spray is near impossible to remove once it is embedded in the subfloor ... it's even more tenacious than dog urine.We bought a property where tenants and their farm had been for 9-years ... it was a complete gut job - even the concrete slab, under the subfloor had to be treated to remove the smell.Good thing your tenant is paying over market rent as they longer the felines stay, the more it's going to cost to be rent-ready for the next tenant.

That's all foreclosure is; the forced liquidation of collateral.Until foreclosure is completed, the estate retains record title.