Have seen the mirroring strategy in action and the contract holders do indeed get stiffed.

Then you'll need to briefly describe the terms you are to assume; That promissory note having a balance this date of $_________ and accruing interest at the rate eight and one quarter per cent per annum having a required payment in the amount of $522.69 due and payable on the 5th day of each month, commencing payments to be paid by Buyer on the 5th day of December, 2010, and on like date of each succeeding month thereafter until the 5th day of July, 2014 at which time all remaining amounts then outstanding shall become due and payable in full to the holder thereof and credited for the benefit of Buyer hereunder......With the notary page and signatures required, 5 to 6 pages is more like it, IMO. .

The lien holder in these other states can't even contact the property owner.

The note holder wants to sell it for 40K. interest rate is 9%, interest only, and the term is only 8 months left.

You need to understand commercial properties before you can do commercial notes successfully.You also said passive income, it can only be passive to the holder/investor, not the broker or one who facilitates a sale, that is earned income.

But were still clueless how to get it done (and who the other owners and lien holders were.)  

Almost every investor is secured either as an owner of a building or as a first lien holder against a property.

The Tenant/Buyer gets to enjoy a right proper notices and rights to redeem any default under the contract before the Vendor (holder) can enforce an action.  

You are right CA markets do have up's and down's ( as most markets do) so if you can time it during the down turn your returns will be faster but if you are a true long term holder by that I mean in the range of 10 to 20 or more years I think the timing may be not be that much of an issue.

And in the process usually wipes out junior line holders.