This gives me major pause.  

The terms of the financing (interest rate, balloon payment timing) need to make sense for your exit strategy.I would recommend getting a detailed inspection to ensure there aren't any major issues you're overlooking.

@Summer Burke Call the water department to see if they'll cut you a break since you fixed it so quickly.

It would be a straightforward transaction, I wouldn't be asking for any concessions or doing any major negotiating. 

It's not liked by most Building Departments because it puts substantially more occupants in a building and each with locked individual quarters and highly taken advantage by slumlords creating fire hazards.

Jeff Dilldine’s first fix-and-flip turned out to be a major win, as the home sold for $425,000, delivering an excellent profit.

I asked if I had to do anything like call the tax department that has the lien and let me know there are excess proceeds and they said no I didn't need to do anything.I guess I'm good then.Thanks for the helpRay 

On a Fannie Mae loan, your scenario has a major Loan Level Price Adjustment (LLPA) of 4.125% for a second home with a loan to value of 85.1% to 90% plus a hit of .75% and another for .25%.

Consider local banks and talk to their commercial department. 

You can always include the cost of the land into a construction loan but if you purchased it already it can play in your favor.At the bank we do all of the work you basically apply for the construction loan and the Building department along with processing sets up the entire process.