With the exception of building a trailer on the property (these are hard to finance), this sounds like a good plan AND if you are using it for your business AND your business pays more than 50% of the rent (if you have more than 1 tenant), then this is a more financeable property in the eyes of banks and credit unions as it would be consider a commercial "owner-occupied" property. 

My though process in undercutting the bank by 1 % was to possibly attract qualified buyers.

Bank of America https://caselaw.findlaw.com/court/ca-supreme-court/1848301.h...Only lasted for four years though.

Bank pushed us to 40% down payment so also executed a $85K seller carry-back loan to cross the finish line.

The property is zoned as a SFR house and likely in a neighborhood of the same.Was the property not appraised by the bank when you got your mortgage?

While more development did happen over the last few years from development projects started in 2021 and 2022 when rates were lower and developers could outlast supply chain issues, the upcoming supply is expected to drop again, as we will discuss later on, with the relatively sharp rise in interest rates that has dried up investment capital due to the fear in the market, sellers opting to hold out on their land and or properties until cap rates and interest rates subside again as is expected in the coming years, as well as banks being cautious to lend on real estate due to this sharp rise putting many projects that were started in 2021 suffer greatly from a 7x increase in rates over the following 40 months that had adjustable rates or 5-year terms which is very common in larger multifamily investing.

This is how banks verify property owners maintain insurance.

That $250k sitting in the bank with no chance of vacancy or capex could earn you $11,250/yr at 4.5%. 

There are still some docs required (ID, bank statements, copies of leases, copy of insurance, etc.), but it's WAY less document intensive than a conventional loan. 

At it's basic level:Assumption: Asking the bank to turn the loan over to you and going through the normal underwriting process, credit, income, DTI ratio etc SubTo: Taking over the loan without telling the bank, no underwriting, no credit check, no income verificationBoth have risks, but it's not my intent to be detailed in this post.