Ohio government officials are planning to control the situation by passing new laws in 2007 that are aimed to tighten subprime loan regulations and allow buyers to sue lenders doing fraudulent practices.

I am sorry to hear you are having the same issue and hope there is a larger class-action movement against what looks to be very fraudulent activity. 

And you are willing to gamble that you are going to win? 

I agree to start smaller, but this is a good deal for this area but its a gamble and i don't have the experience like you mention, Trying to think of other things to do with property (rent or airbnb) Anthony - i have been thinking about a cheap renovation of changing the windows out, adding the third bedroom, changing cabinet doors and painting cabinets, remodel of the existing baths.

From the link you provided, this excerpt goes a long way towards making me feel more confident:"But courts will impose personal liability only on those individuals who are responsible for the corporation or LLC's wrongful or fraudulent actions; they won't hold innocent parties personally liable for company debts."

When dealing with investors who gain their capital from fraudulent/illicit means, what authorities should be made aware and in what order? 

It is always a gamble when spending money.but like the movie Field of Dreams said over and overIf you build it they will come.I believe that there are people who although don't make muchand cannot afford the extras would love to have the extras and take care of the privilege.What I have found is that if you price too low you get people who are too slick for their own good.It is my model to offer the upgrades for the same price as my competition.not lower but the same.So the value is built in upon lease signing.

So, we took a gamble and sold our home we forced sweat equity into and took our equity and ran west to start over again.

@David Gamble - If you are wholesaling this deal you with the numbers you provided you are leaving zero equity to the end buyer.

We are trained to know what are fraudulent transactions.