Interesting to see how feasible this will be. 

House was built in 1953. 

The tenants are currently in court with a title dispute so the house would have to be paid for cash only.I would like to convert it to a primary residence and turn the garden level into a separate two bedroom apartment for use as an in law suite.

Underpriced properties get scooped up within the first week—often before the first open house.

One thing that's worked really well for me is looking through county deed records of the addresses that the LLC's are being housed under.I'd say 50% of the time the LLC address leads to a residential property, that I can then skip trace. 

Could you gift the down payment to your mother in law so she can buy it and then transfer title to you when your house is done?

Pick up the book Building Wealth One House at a Time by John Schaub.

Months passed and ABC kept saying that house was “very close”.

I am actually looking at a house that is not a Victorian but needs part of the home bulldozed and a ton of work done.

If it was me...I'd check with zoning to find out how many dwelling units I could build, and I'd find what the requirements are for those units (type of house, height and setback restrictions, etc.).Then I'd find out what local builders think the cost to construct would be - just get a cost estimate per square foot for 2 or 3 different levels of finish.