Why pay off the mortgage early? 

Off market deals usually have nonrefundable deposits and a clunkier process that isn't as suited for out of state people until they have good contacts in the area to evaluate the property (mostly contractors that feel comfortable evaluating projects for you).

My mother-in-law is saying that my wife needs to sign off on the loan.

On market with motivated seller - negotiated $175k off list price How did you finance this deal?

I was laid off by a big PM company and prior to being hired by that company I had already made it a goal to open my own some day.

We paid off our primary home last year and have been slowly getting the courage to jump into the investing market where we live in the Pacific Northwest.

If you have large debt with a high interest rate, I would consider paying that off before getting started investing in real estate. 

There is some legislative push-back on "junk-fees", but every example I have seen was IMO truly a rip-off.

What would I need to do to structure the note in order to have a note buyer come in and buy the note or buy a partial enough to pay off the 215k at closing and still have some difference coming to me or the note revert back to me after the partial was paid for. 

Quote from @Dylan Gomez: I inherited two homes, both were paid off one was livable, and I now live in it, the other was a rental in TERRIBLE condition.