He examined the place w/ me and determined it would cost about $40k to fix the place (foundation damage & other things) and I was able to get the purchase price down to $48k.

Lastly, additionalbackground on friend is he just completed his post graduate degree andpassed the required state examinations approximately 6 months ago and issaddled with debt; however, he is beginning to make money and thiswill be something we both have on the side to grow our net worth withminimal tax liability consequences.Any and all insight from BP users would be GREATLY appreciated.

:I'm not saying this is a regular occurrence, I'm saying that this situation is worth being examined and that there is possibility that homes that are out there sitting for years with no one doing anything about them, maybe the banks have they plates full to the point they aren't putting the time or feel the mortgage isn't a priority on their list anymore.

For my state (Ohio) its a 120 hour course followed by an examination.

I'm currently in the process of acquiring my salesperson real estate license in Michigan and take my state exam in November.

I'm thinking that ROI is really only effective in examining whether a house is worth buying as an investment. 

If we had been able to do that, we would have likely saved 20-30k on the purchase price (someone bid us up in the auction)....However, I think we made the right decision to NOT do that given where we were and comfort level with the process (perceived risk was higher at that point and its worked out well)To buy directly from someone that's getting foreclosed though... as someone mentioned you do need to consider all the 'usual' stuff that happens in a closing/settlement - including having title examined/possibly insured ---  you can pay for this directly from a title /abstracting company however they usually want it paid in advance. 

A refi will only compound cash flow issues.But you need to examine the impacts of selling and leaving the real estate sector now. 

See link below if you wish.https://www.nreionline.com/finance-investment/examining-first-crack-real-estate-crowdfunding-industry-s-fragile-foundation

An examination of sales in stated areas between 2010 and 2012 -- some of these properties actually sold for 1/3 to 1/2 of what they're trading for today.