Your goal is to plant the idea in their mind and create a situation where selling to you feels like the easiest and most logical solution for them.If you haven’t already, the first step is to get pre-approved for a mortgage so you know what you could afford if you were to purchase the property conventionally.

I plan to purchase a primary residence, multi-family home (2-5 units, 'house-hack'). 

You have three choices...transfer the property and keep the loan in tact hoping they won't trigger due on sale, refinance into a loan that allows it, or simply leave things as they are. 

This LLC has you as the managing member and 80% owner and can purchase investment real estate of your own or with other partners.

Quote from @Alberick Small: I was thinking of purchasing Lee Arnold's Reverse REO Program, I have read all the horror stories and the many that may have been duped over the years.

What the IRS is concerned with is when you are doing a 1031 and want to purchase a property from a related party. 

The tax is based on selling price minus purchased price.

So, we felt we had no choice but to stick with this guy.Move on to the end of June. 

Consult with an attorney to provide a purchase and sale agreement in your respective state with an assignment exhibit included. 

You could also purchase below market value.