I’m the last person who should complain about grammar, but these are yellow flags, at best.

The absence of a personal guarantee from any disqualified persons is still required, just as with third-party financing.

Quote from @Havital Miltz: I do not know that if someone is in the hospital you can force them to close, I am not an attorney, but I doubt any court will find in your favor, closings do not always happen exactly on the day that is planned, even if everyone is healthy and well, the wholesaler here is not the reason for the delay so I am not sure what exactly you can sue him/her for, they are also being held up due to the seller not being wellJust give the person some time to get out of the hospital, closing will probably not happen the very next day either, this is really extenuating circumstance. 

Pre-foreclosure - homeowners are desperate to avoid foreclosure and they quitclaim deed the title to some XYZ organization , person, or to a lawyer that specializes in foreclosure defense.

This means, on average, that this person is facing foreclosure or bankruptcy, and has no other reasonable options.

If you close with a conventional loan, it will need to be in your personal name.

Initially I didn't have a personal connection to the area and didn't know much about the city.

I'd personally sell the townhouse (doesn't sound like it cashflows or would make a good rental property) - you may have no capital gains if you have lived in it the past 2 out of 5 years - I believe the first 250k for single filers is exempt from taxes and the first 500k for married couples.

I personally haven't done this but I have helped clients do it in the past.Hit me up if you're interested!

I personally would recommend the last method.