If the borrower does still have title to the property, it is big, bold neon sign to you convince the lender to write-off the balance of the mortgage which would allow you to offer the borrower/owner land-value for the property.The other thing to verify is the state of the property tax account.  

Co-Founder & Managing Principal of Red Knight Properties, a boutique real estate investment firm focused on value-add mixed-use and multi-family opportunities in the Northeast.

If the buyer is uncomfortable or unwilling to provide proof of funds to you that may be a red flag; see if they would be willing to provide it to their attorney who can verify, and then make sure the contract protects you. 

Big banks have too much red tape, I wouldn't recommend going through them for anything investment-related but just my two cents. 

I'm wondering if that's a basic red flag or if property managers prefer to remain in the city.

Red flags. 

And not to discount the knowledge that can be shared on this site, but asking the internet what to do in this scenario is a big red flag to me.I submit that you need a partner in the venture who has significant experience in this industry.  

Then according to our 203k inspector ( one of the red tape hurdles on this loan) FHA typically doesn’t like to see people moving from a duplex to a 4 plex.

I love a yellow house with black shutters and a red door. 

(Low supply) or red flag ( low supply because no demand)I checked CraigslistFB MarketplaceZillowTruliaRent.comAre there any other places I should be checking.