I have a few more details on the deal under my post - "Apartment REO analysis" - if interestedMy thought is that 5 years is more than enough to fix this thing up, get occupancy up and get my "p's and q's" in order to get conventional financing.I don't think rates will be going up anytime soon, but the next 5 years is hard to predict.Given a couple years to get things in order 1) What exactly should I do from the very beginning of ownership to position myself the best to get financing and 2) what kind of permanent financing options would be available to me and what are my chances of obtaining such financing.

They work particularly well for properties that are under-performing in that they give you time to turn the property around, stabilize income, increase value and refinance with permanent financing when you purchase.

Now that the kids are grown, we've downsized, turning that tax-free profit into more investment property, and moved into something we can turn into another great rental when we buy a permanent retirement home in the next few years.

Section 8 sent a notice that they'll be pulling the tenants voucher and permanently terminating her section 8 eligibility effective 7-31-14.

You want to rehab this and keep it for yourself or rental, you get to refinance it into a permanent loan and pay closing costs and loan origination costs again.  

If so, what kind of permanent loan should I get after the construction is done. 

The tenant has failed to honor a permanent relocation agreement with the landlord pursuant to LAMC Section 152.05.10.

If I can just permanently get rid of the scorpions I know this property will do well as a STR.

I would ask yourself are you willing to permanently change your no pet policy.  

You can rent out a second home as an AIRBNB or VRBO and also transition it into a permanent rental in a short period of time.You mentioned talking to multiple people and it does not surprise me as the bank/lending industry is full of new comers, loan officers with no investor options or lack of knowledge.