If the owner doesn't redeem, the lien holder just lets it go back to sale.

You'll have to find who the lien holder is, why the property was liened and what it would take to satisfy the lien or reduce the amount owed.

She checked with her insurance and they won't give her umbrella coverage for the property unless she is the sole title holder.   

I have a question about the liabilities associated with private lending.If i write a personal check to a flipper as an equity partner, junior lien holder or senior lien holder. does that open doors for potential lawsuits related to that flipper and the property? 

My rhetorical point about "each time the lease expires" wasn't presuming "a financing arrangement accepting annual payments that are reducing the sale price", but rather, giving the Lease-holder a new Option annually if they so choose, with a new up-front fee each time, as if this was the first time the option was being given ie. no reduction of price and no deduction of past payments.

These accounts can even form and own an LLC that takes title to notes for an extra layer of protection on behalf of the IRA account holder.

to drop their ask otherwise there isn't any margin in the deal.asking price + taxes + repairs + window loan = ARVUnless you're able to get the note holder to take a short sale I would suggest you pass.

Second question, at this point how would the debt holder in second position protect their position?

According to Netronline, the first has initiated FC (in April) but now, according to court info the case is "on hold for loss mitigation"  I contacted the attorney of the first lien holder and she was no longer with that firm. 

The interior electrical work should/would be nil, and the cost of submetering won't require the installation of two new power panels, assuming you currently only have one. idk maybe @Stephen Joyner can chime in and provide some electrician professional insight on this option.Now the on the billing side of things, you would still be responsible for providing electrical service to the units as the main electric company account holder, but you would be able to bill each unit for their own proportionate share of the electric bill.