So I’d swallowed my pride by forgave his half month rent that he’d never paid and offered his security deposit back in full; expressed as that he’s rather the one doing me a big favor to cut me lose; in a baby talk tone; advanced from his refund and rented U-Haul truck and storage for him.

We just had a very enlightening experience in this area - we gave what we thought was a good presentation to someone who had expressed interest in a particular project - he decided almost immediately that he wasn't interested, but his attorney soon came on board with the project with almost 3 times the investment amount that the first guy had discussed.

Can someone express to us how the initial contract is structured?

Do I mail a letter to the owner expressing my interest in purchasing their house?

You're talking about conventional deals, not auction purchases.If it does sell at auction, and you're there, approach the buyer and express your interest.

I'm interested to see what other folks say here, because my dad has also expressed interest in investing through us.I think it's important to consider what you both want and find the win win.  

Now even if interest rates go up in year 10 it probably means that rents  are also going up so even at a possible higher cap rate the "value" can be higher since your NOI will be higher.BUT, the main thing to realize is that cap rates are based on the market's perception of value of NOI and all cap rates are is a means of expressing that value.

The house has been listed for almost a year and is it much need of repair.Asking Price: $43,000Zillow Zestimate: $48,600 (down -$7,600 Last 30 days)Year Built: 1948Lot: 1.5 acres875 sqft2 Bedroom, 1 BathDetached GarageCentral Heat & Air: Installed 6 years agoOriginal Electrical and Plumping (With exception of added outlets and breakers for central heat/air)Through candid casual conversation and before my expressing interest, I learn that the home equity loan owed is $29k.

I have a close friend of mine renting the property from me and he has expressed interest in purchasing the property.

But I've got to first line up a replacement PM before firing the current one.Meantime, I'd like to reach out to the tenant because1) The tenant had expressed (through the leasing agent at the time of lease signing) a desire to build a deck and backyard fence.