This would be our first deal, so an extra pair of eyes would be helpful.

I would back off unless you have a second pair of eyes to look at it that know the business well !

We interview the potential clients up front (the Plinko chip) and find out what their goals are and what they are working with (all the pegs on the Plinko board as the chip bounces off of them on the way down) and then we pair them up with the lender that best accomplishes their goal (the chip is at the bottom of the board and we know where to send their loan). 

The structure was sold to a pair of investors who built a house designed to look like a water tank in 1984.

Pair with a seasoned lender, get your credit checked and determine what price your future home will be.    

'Too much work'- indicates you're not really looking at being involved with too much rehab work, which is fine but needs paired with realistic market availability so you may need to expand your search outside of Austin.    4B. 

I had the idea of trying to get a normal 80% loan with a lender but pairing that seller financing for the 20% downpayment. 

Supply chain constraints for key materials such as lumber – paired with difficulty in finding qualified workers – have moderated the pace of building since late 2020.

All it costs is $50 and probably a new pair of shoes when your done because the soles will be worn down.This has got to be my longest post ever so I how you enjoy it.

Or get someone who can prospect for you and workout a deal that is good for both (give him a % of profits or purchase price) then pay the title company as a second pair of eyes to make sure nothing is missed.If its too much work and complicated then the distressed market is not for you.