You can also pick up a great deal on the mls if the seller chose more of an inexperience broker and just listed it like a traditional SFH. 

Best advice is Not all foreclosures sell for a good deal, and most will not qualify for traditional financing, so if you are serious about buying an REO make sure you either have cash, construction financing, or commercial type loan at your disposal.

Traditional bank financing.

I don't see that there is any value in having a SECOND living room but limiting people to the 2 tiny rooms that function as traditional bedrooms.

While it may not be traditional it alleviates problems like you're dealing with on-change over...

Meaning -- Can I structure this to where the buyer gives the seller a downpayment and the seller carries the remaining note for a short time -- with monthly payments to seller -- while the buyer finishes the remodel to their cosmetic liking... after which the buyer can get a traditional loan and pay off the seller in full? 

I am talking about placing a factory built home on a permanent foundation with that home built to the same national standards as used for traditional stick built homes. 

Doe it have enough upside vs. a traditional value add or stable property, to justify doing the deal.

If you are only going to rent out this one unit, a Traditional LLC is still far better than simply holding property in your own name.

In fact, I encourage my clients to form a Traditional LLC shell corporation to conduct all business with the public.